Tata Steel hopes to kick off Bangla plant by 2007

Tata Steel has resolved most of the issues regarding building of the 2.4 mt steel plant with Bangladesh government, B Muthuraman, MD, said on Wednesday.

Tata Steel expects to start building the plant in Bangladesh in 2007 and the project is expected to cost Rs 6000 crore, he said.

"It is quite possible that we will start building the plant in 2007. It (timeframe) looks realistic," Muthuraman said on the sidelines of a meeting between Bangladesh Prime Minister Khaleda Zia and Indian industry chambers.

He said the gas pricing issue is also likely to be resolved soon. Tata Steel will use gas from Bangladesh for its proposed power and steel plants. Bangladesh has huge gas reserves. However, there are differences between Dhaka and the Tata group over the pricing of gas.

On Tuesday, Bangladesh Minister for Finance and Planning M Saifur Rahman said the price offered by Tatas for gas was "embarrassing". Tata group is planning a total investment of $2.5 billion in Bangladesh to set up power, fertiliser and steel plants.

Muthuraman said he expects steel prices to remain around the current levels for the remaining part of 2006.

Steel prices have risen in the last two months after weakening during April-December.