SAIL to set up new rail mill with $800 million investment: Chairman Prakash

SAIL is bullish on the demand for rails in the country and has decided to set up a new rail mill at an investment of $800 million, the company's Chairman Amarendu Prakash said on Saturday.

The company has decided to go ahead with the investment plan despite not having any order indication from its largest buyer Indian Railways, Prakash said at a panel discussion at the Global Business Summit (GBS) in the national capital. 

The chairman said such kind of confidence is a result of growth oriented policies of the government.

"Last week, we decided to put up an 800 million $investment into a mill, because I am confident that railways will go nowhere and they will have to buy from me if I put up a mill. So, I have taken a decision like that. So, that is the kind of confidence that comes when the policies we know are growth oriented, and they are bound to continue," he said.

Prakash said SAIL had been following up with the Railways for the past seven years for their future demand so accordingly the steel maker can plan rail production.

"I think, last seven years, we have been running after Indian railways, saying, how much rail track will you buy from us? Should we put up a new mill? Should I make an investment into a new mill? We can produce good railways. Will you buy it? They said, I am not going to give you any comfort about what I will buy in the future," the Chairman said.

SAIL, under the Ministry of Steel, makes rails at its Bhilai Steel Plant (BSP) in Chhattisgarh and forged wheels at Durgapur Steel Plant (DSP) in West Bengal.  'India expected to surpass 300 MT capacity target by 2030' 

India is expected to surpass the 300 million tonnes (MT) steel capacity target by 2030 on the back of firm demand, SAIL Chairman Amarendu Prakash said on Saturday.

 

Prakash said the number looked unrealistic when the national steel policy was launched in 2017 to scale up India's total steel manufacturing capacity to 300 million tonnes per annum.

 

In India, steel capacity is slated to grow to 330 MT capacity in the next five years (2030) from 180 MT capacity, Prakash said.

 

"In fact, in 2017, India set up a national steel policy, and we said by 2030, we want to get to 300 MT. As steelmakers, we laughed. Let me admit that we laughed that 300 MT in India, at that time we were barely at 80 million (MT). We said by 2030 it is a joke. Three months back, we sat down and revised our target and said, no, by 2030, not 300 MT but 330 MT," the chairman said.

 

The demand elasticity is amazing. Last year, the Indian steel sector grew at 14 per cent against GDP growth of 6.5 per cent to 7 per cent. This year, in the first 10 months, it has grown by 11 per cent.

 

"So that's the kind of inflection point that we are seeing in terms of pace and quantum," he said.