OP Jindal group plans Rs 12000 cr steel project

The O P Jindal group today announced plans to set up an integrated steel plant in West Bengal with a capacity of 5 million tonne for an investment of around Rs 12,000 crore.

The steel plant would be commissioned in two phases with a capacity of 2.5 million tonne in each phase.

Addressing mediapersons on the sidelines of Metals 2004 organised by the Bengal Chamber of Commerce & Industry (BCCI), Sajjan Jindal, managing director Jindal Vijaynagar Steel Ltd (JVSL) said the project would be commissioned in 36-48 months from the zero date.

The steel plant would be of the same size as the JVSL plant and would be close to Asansol, near the Indian Iron and Steel Company (IISCO) project. The investment would be made under any of the Jindal group companies. The plant would create 10,000 direct jobs and another 10,000 indirect jobs.

According to the blueprint being chalked out, in the first phase, the plant would produce semi-finished steel and, in the second phase, flat and long products. Jindal said the plant would use the blast furnace route for the project.

The plant would be funded through a mix of debt and equity. Jindal said, the ratio would be 1:1.

Elaborating on the reasons behind setting up the plant in West Bengal, Jindal said one of the main factors which worked in favour of the state was the proximity to Haldia and Paradip ports.

"We can bring in raw materials easily and export finished products" he pointed out. Moreover, the other inherent advantage of the state was its skilled labour. Jindal said its plants elsewhere in the country had manpower from West Bengal.

However, one of the riders in the project was iron ore and coal linkages. The project would be finalised on the basis of assurances from the Jharkhand or Orissa government on raw materials.

Jindal said they had conveyed this to chief minister, Buddhadev Bhattacharya and he would take up the issue with the Centre.

The issue had become critical as the policy pursued by the state was that access to raw material would be given to only companies setting up plants in their states.

Jindal said a meeting was scheduled with state commerce and industry minister, Nirupam Sen, to work a suitable solution.

He, however, clarified that the company would continue to pursue the matter with the state government.

He said a policy for inter-state collaboration in the regard would have to be formulated at the national level.

The Jindal group was already making substantial investment in Orissa.

Earlier in the day at the seminar, chief minister, Buddhadeb Bhattacharya appealed to other investors to come forward and invest in West Bengal.

The Lifetime Achievment Award by BCCI was conferred on O P Jindal, the Jindal group chairman.