Friday, January 23, 2015

SAIL to make foreign foray, plans Rs 10K-cr plant in Iran

MAKING its overseas foray, state-run steel major SAIL has proposed to set up a nearly 2-million-tonne integrated steel plant in Iran at an estimated cost of Rs 10,000 crore, which will be India’s first major investment in the country.
For the greenfield venture, SAIL has asked the Iranian government to provide 500 hectares of land...
near the country’s Bandar Abbas port and another 500 hectares of contiguous land for future expansions, said a media report.
The proposal had come up for discussion during a meeting between steel minister Narendra Singh Tomar and Iranian envoy Gholamreza Ansari.
SAIL has sought captive access to iron ore, limestone and dolomite from Iran.
Allaying apprehensions on availability of raw material resources, Ansari said that his country has iron ore reserves worth 2.5 billion tonnes and is keen to explore natural resources jointly with India.
“SAIL has suggested that natural gas should be made available at the proposed plant boundary along with necessary rail and road linkages to ferry steel making inputs to the plant,” said a steel ministry note.
The proposal by SAIL suggests that a corridor should be set up for laying of pipeline for de-salination plant. The proposal is still in the form of a concept note.
The ministry is keen that a joint working group should be set up comprising the PSU and an Iranian nodal agency to explore feasibility in this regard.
Iran is also ready to offer a site near its Chabahar port. This can be used to transport iron ore if a consortium led by SAIL explores iron ore from the Hajigak mines in Afghanistan. The consortium, Afghan Iron and Steel Company (AFISCO) — led by SAIL — has bagged the bids for exploring three iron ore deposits in Hajigak in 2011, which has an estimated reserve of 1.8 billion tonnes of high grade ore.
SAIL had bagged an export deal of 1,00,000 tonne of rails to Iran Railways in October last year.
“But the credit line to cover rail exports transaction, which is under finalisation, needs to be expedited by Iran. There is a need to create a mechanism so that private buyers of Iran can import materials through government agencies like STC in India,” according to the note.
UCO Bank facilitates transactions with Iran, which are only oil related.
Now, Iran insists India should allow opening of accounts in different banks for better non-oil trade between the two countries.
Since February 2013, when the US disallowed payment channels to Iran as part of its economic sanctions against the Persian Gulf nation, India has been paying 45 per cent of its Iran oil import bill in rupees through the bank.
SAIL is the country's largest and the world's 15th largest steel producer with a production of 12 million tonnes of crude steel. At present, the Government of India has 86 percent ownership of SAIL. The company owns and operates nine manufacturing plants, including two subsidiaries.

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