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| Bhushan Steel sets June deadline for Bengal project |
| Devjyot Ghoshal & Ishita Ayan Dutt / Kolkata May 17, 2010, 00:02 IST |
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Delhi-based Bhushan Steel will wait till June for a favourable response from the West Bengal government on its proposed six million tonne steel plant in the Asansol-Durgapur belt of Bardhaman.
“We have written to commerce and industry minister, Nirupam Sen, indicating a June deadline because Sumitomo cannot wait indefinitely,” said sources close to the development.
Japan’s Sumitomo Corporation has evinced interest in picking up stake in Bhushan’s Bengal project. The extent of participation could be 26-40 per cent. However, the uncertainty over the Bengal project has been a major setback.
Bhushan’s Rs 20,000 crore was stuck as Coal India raised objections to having industrial projects in the areas as it was said to be coal bearing. Two other steel projects—Videocon and Abhijit group—have landed up in the same boat.
Bhushan Steel sources said, “The state government has communicated that Coal India was willing to reconsider its stance.” A meeting was held recently between government and Coal India officials.
Senior officials of Coal India Limited (CIL) did confirm that "discussions" had taken place between the state government and the miner. However, he said that there was no indication that CIL "had made any concessions".
"We maintain that no permanent structures should come up on coal bearing areas. We have not made any concessions in this matter," the official said.
In February this year, CIL had been successful in its attempt to relocate NTPC's North Karanpura Super Thermal project in Jharkand, by arguing that the establishment of the facility would block about six billion tonnes of coal.
However, CIL, which is among the world's largest coal mining firms, had subsequently agreed to help NTPC find an alternative site through its engineering and consulting arm - Central Mine Planning & Design Institute Limited (CMPDI).
"If these companies (including Bhushan) approach us, we will be open to help them find a non-coal bearing area (through CMPDI) to set up their projects," the official added.
Bhushan has already realigned the project and is not willing to move to an alternative site.
"A lot of work has been done," said Bhushan sources.
Missing the June deadline could cost the West Bengal government a major project. Bhushan Steel has made significant progress in Karnataka, where it has proposed setting up a plant of similar size.
“We have signed a memorandum of understanding and are looking for land,” said Bhushan Steel sources.
According to Bhushan Steel, Sumitomo was keen on partnering with the company, irrespective of the location. If the project in West Bengal does not materialize, Bhushan would proceed in Karnataka.
Bhushan has a second project—a cold rolling mill—at Sankrail, which again has been scaled down. The original investment planned was close to Rs 1,000 crore, but now the company plans to invest half of that as the product-mix has been changed.
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