The country's largest stainless steel producer, JSL Ltd, will invest Rs 150 crore in the next 3-4 years for developing its captive railway line in a bid to save cost on its cargo movement.
"We are developing our own railway siding in Orissa. We will be investing up to Rs 150 crore in the project to save cost on our cargo movement," JSL Director (Strategy & Business Development) Arvind Parakh told PTI.
A siding is a rail line connecting the nearest railway station to the end-factory and is mainly used to transport raw material and end products.
The firm has received in-principle approval from the railway authorities for the project. JSL has already invested about Rs 50 crore in the project and said it would complete the laying down of the tracks in a year.
"We have already invested Rs 40-50 crore in the project. We have bought two locomotives, acquired the required land, and the tracks would be laid in about 40-50 km area in the next 8-12 months," he said.
The rail line would link JSL's unit in Jajpur to Tumka railway station.
JSL Ltd, which is spending Rs 5,700 crore in the second phase of its Orissa project to take its production capacity to 1.5 million tonnes per annum, said that the railway siding would immediately help it to reduce the cost on its inbound and outbound cargo movement.
In Orissa, the logistic cost is highest compared to other states..."We would be able to bring down the cost by 20-30 per cent by having our own railway siding," Parakh said.
JSL Ltd spends up to Rs 800 crore per annum on movement of inbound and outbound cargo, including raw materials and finished alloy products. Moreover, the stainless steel producer is also investing up to Rs 100 crore in its logistics arm JSL Logistics in the next two years.
It has already bought 20 trucks for the firm to handle its on-road cargo movement and would be buying additional 100 trucks in the next three months.
"We will spend about Rs 17 crore to buy additional 100 trucks for our subsidiary," he added.
