Sucheta Dalal :ArcelorMittal officials contradict each other on Indian projects
Sucheta Dalal

Click here for FREE MEMBERSHIP to Moneylife Foundation which entitles you to:
• Access to information on investment issues

• Invitations to attend free workshops on financial literacy
• Grievance redressal


You are here: Home » What's New » ArcelorMittal officials contradict each other on Indian projects
                       Previous           Next

ArcelorMittal officials contradict each other on Indian projects  

January 12, 2010

Steel giant ArcelorMittal may drop the Rs50,000-crore project in Jharkhand if clearance to it were delayed inordinately, a company director and Luxembourg minister Jeannot Krecke has said, a view contested by another official who deals with Indian operations.


"If Jharkhand is not feasible, we cannot work on the project. ArcelorMittal may drop it if there are delays in approvals. That will be a pity. The country will lose investment opportunities," Mr Krecke told PTI.


However, ArcelorMittal group management board member Sudhir Maheshwari gave a different version saying, "We have no plans to scrap our Jharkhand project. In terms of how projects will be built, it is expected to come up in phases."


ArcelorMittal chairman and chief executive LN Mittal, who was recently in India, had virtually condemned the Indian system saying that the country was “not prepared” to handle such mega investments.


Mr Krecke also said that the company has already downsized its Rs1 lakh crore projects, in Orissa and Jharkhand each, by half. The two states would now have 6-MTPA steel projects from ArecelorMittal, he added.


"ArcelorMittal has decided to downsize the Orissa and Jharkhand steel plants to 6MTPA each due to delays (in acquiring land, among other reasons)," Mr Krecke said.


Mr Maheshwari also contested this statement, saying there was no decision to downsize the two projects and the company's plans would move ahead in a phased manner.


The company is working to set up two 12-MTPA plants in India, one each in Jharkhand and Orissa since 2005.


Elaborating on the company's decision to downsize the projects, Mr Krecke said, "I know that there are problems because it is in some special tribal area and they know that too. So I think they have narrowed the projects and downsized it to 6MTPA (each)."


The decision to alter investments also follows the Karnataka government clearing ArcelorMittal's Rs30,000-crore project in the state.


Asked if the company has already informed the Indian government of its decision to scale down the projects, Mr Krecke skirted the question saying, "It is a private company and it’s up to the businessman to communicate to the government."


About any plans to take up the matter with the government for expediting projects, Mr Krecke said that the company chief had already met prime minister Manmohan Singh and steel minister Virbhadra Singh and conveyed his concerns in this regard.


"I will also go, giving the message to the government for expediting the projects," said Mr Krecke, who has been appointed shareholders' representative on ArcelorMittal's board from 1 January 2010.


The company requires nearly 11,000 acres of land in Jharkhand and about 8,000 acres in Orissa, where it is facing resentment from the locals. The steel maker has been allotted Karampada iron ore with estimated reserves of 65MT mines in Jharkhand to feed the proposed plant. The steel major still awaits iron ore mining leases in Orissa.

Moneylife Digital Team


-- Sucheta Dalal