SAIL, NMDC, Singh to sign Raoghat rail pact today

The Steel Authority of India Limited (SAIL) will sign the agreement with the Railways, National Mineral Development Corporation (NMDC) and Chhattisgarh government on Tuesday to lay 235-km Raoghat rail line to facilitate iron ore transportation to Bhilai Steel Plant (BSP).

The line will connect Dallirajhara-Raoghat and Jagdalpur and also serve tribal-predominated Bastar region.

The project will help mineral prospecting in the region. The area had large iron ore deposits. The economy of the tribal belt facing Naxal problem was also expected to improve.

"The Memorandum of Understanding (MoU) between the four stakeholders of the project will be signed in New Delhi on Tuesday afternoon," additional chief secretary P Joy Oommen told Business Standard.

The project will be completed in two phases in five years, he added. SAIL was keen to see the line built at the earliest, as iron-ore deposits from Dallirajhara mines were running out. SAIL's Bhilai Steel Plant (BSP) was now getting raw material from Dallirajhara mines.

In the first phase, 95 km rail line would be laid between Dallirajhara and Raoghat, Oommen said. Raoghat and Jagdalpur would be connected in the second phase of the work.

Chhattisgarh government will provide land free of cost and bear all expenses of compensation during acquisition.

SAIL will be the major contributor for the Rs 970-crore project. Sources said SAIL would invest about Rs 450 crore while railways would put in Rs 480 crore and NMDC the rest.

The major share was from SAIL as it would use the line to carry raw material from Raoghat mines to its facilities. "The project would help movement of raw material to BSP and other plants of the SAIL that aims to achieve the target of producing 23 million tonnes of steel by 2010," a senior BSP official said.