Essar may shelve $1.9 bn plant in Indonesia

Essar Steel may shelve its plans to construct a $1.9 billion plant in Indonesia, following an adverse ruling by the country's anti-dumping authority.

Indonesian news agency Antara reported that Essar Indonesia, the local unit of the Indian firm, will postpone construction of the hot rolled coil (HRC) processing plant in the South-east Asian nation.

When contacted, an Essar Group official said, "As a result of the anti-dumping ruling, the company will review its plans for setting up the HRC plant."

"The decision followed alleged dumping against Essar's principal by the Indonesian Anti-Dumping Commission (KADI)," Antara said.

KADI is investigating the dumping allegation filed by companies led by state-run steel maker Krakatau Steel against Essar Steel Holdings and other HRC suppliers from a number of other countries.

"Essar said the investment climate is less conducive and there is no guarantee of supply of the basic material in iron ore," Antara said.