Steel baron Lakshmi Mittal believes ArcelorMittal's two giant steel projects in India, planned since 2005, were "highly unlikely to be realised", and said his new strategy is to have a number of smaller steel-making hubs.
In an interview to the Financial Times in Tokyo, Mittal has said his new strategy was to create many small steel-making hubs across the country, each capable of making a few million tonnes of steel a year.
"My plan is now to have two-four sites rather than concentrate everything on large plants," he told FT.
ArcelorMittal had announced a 12-million-tonne steel plant in Jharkhand in 2005, followed by an identical plant in Orissa in 2006. But they are yet to take off, owing to problems with land acquisition and other clearances. Mittal, however, added he was still "determined to participate" in the steel industry in India, where demand for the metal is increasing quickly as a result of new investments in industrial expansion and infrastructure development.
Last year, the company announced plans to set up a smaller steel mill in Karnataka. Proposed investments in the India projects total over Rs 100,000 crore. Meanwhile, Mittal has urged China to relax its investment rules. "You cannot expect business people in the US to be relaxed (about planned inward investments by Chinese companies) if their attempts to do the same thing in China are covered by restrictions," he told the financial newspaper.
The statement was on the heels of a row in the US over a planned participation by Anshan Iron & Steel, one of China's biggest steelmakers, in a $168-million venture to build a steel plant in Mississippi by John Correnti, a veteran US steel executive.
Mittal's own efforts to expand in China have been hampered by Beijing's inward investment rules. So far, he has been allowed only to take minority stakes in two medium-sized China-based steel producers, rather than take control of large ventures, as he would have liked, the report said. The Chinese government has refused to allow non-Chinese companies to take majority stakes in business fields that Beijing regards as "strategic" to the country's long-term interests, one of which is the steel industry.
