Delhi-based Bhushan Steel has initiated discussions with the $2.4 billion diversified Japanese trading company, Sumitomo Corporation, for investing in Bhushan’s proposed steel plant in West Bengal. Neeraj Singal, managing director, Bhushan Steel, confirmed the development and said, the partnership had not been firmed up as yet, but discussions were on.
Bhushan had initially planned a 2-million tonne integrated steel plant with a captive power plant in Bengal, but if the deal with Sumitomo materialises then the size of the project would be tripled.
The investment in the project was originally estimated to be 8,800 crore, which also included a 0.5-million tonne cold-rolled and galvanising plant for automobile grade steel.
The move could well begin big-time investment in Bengal, which received a major jolt after Tata Motors pulled out of Singur.
Singal said, Sumitomo is a technical partner in Bhushan Steel’s Orissa project. Singal explained that Sumitomo wanted to invest in the Orissa project but that was not possible. Bhushan was willing to partner with Sumitomo in the Bengal project. Bhushan is setting up a 4-million tonne plant in Orissa, part of its 12-million tonne capacity expansion in eastern India.
Sources close to the development indicated that the land requirement for the 2-million tonne plant in West Bengal was 2,500 acres and if scaled up to 6-million tonne, it would require an additional 1,000 acres. The project would come up in the Bardhaman district.
“Public hearing for the project is currently going on and the feedback from the people is favourable,” said sources. The rehabilitation package will be submitted shortly, which includes land-for-land and housing for the land-losers. Industry sources said, “It was surprising that Sumitomo was planning to invest in a project in the middle of the economic meltdown.”
