Calcutta, Nov. 28: Bengal is set to attain a cutting edge in steel, with the Jindals close to signing a deal next month for a Rs 10,000-crore integrated steel plant in the state.
Sajjan Jindal-owned JSW Steel and the state government are putting the final touches to a memorandum of agreement (MoA) for possibly the largest integrated steel plant in the state.
The company has zeroed in on Salboni in Midnapur as the site for the unit.
“We have made good progress on the project. An agreement will be signed next month,” B.N. Singh, joint managing director and chief executive officer of JSW Steel, said here today.
Sources said deliberations were on within the company on the size of the plant. The capacity of the plant could be either 3 million tonnes (mt) or 5 mt.
The company needs 6,500 acres for the project that was dumped a year back when Jharkhand denied captive mines to JSW Steel. Even at that point of time, Jindals were keen on a finishing facility in Bengal, while they embarked on steel projects in Jharkhand and Orissa. Now, one year down the line, the Bengal project is closer to reality, while the plans for Jharkhand and Orissa are yet to fructify.
However, the company will not rely on captive mines in Jharkhand for the project, though Bengal chief minister Buddhadeb Bhattacharjee has been lobbying hard with the Centre for such mines.
“We will enter into long-term supply agreement with private miners of Jharkhand and Orissa to procure the raw material,” sources in the company said.
Analysts said it was possible to sustain operations even without a captive mine, citing Japan which produces 100 mt of steel without possessing ore.
Depending on the size of the plant, JSW Steel will require 5-8 mt of iron ore for the project.
Meanwhile, the state government is taking steps to provide 4 mt to 6 mt of coal to the project. West Bengal Mineral Development Corporation, the state nodal agency, along with a private party will supply the coal.
For the daily water requirement of about 50 million gallons to 60 million gallons, the company plans to tap the three rivers near Salboni. The preference is for water from the Kangsavati.
Permission needs to be obtained from the state irrigation department for the water that will be ferried through a pipeline to the plant.
The ground breaking will take place once the government acquires land and hands it over to JSW Steel.
The project will be the first major investment in Bengal’s iron and steel sector after Durgapur Steel Plant (DSP) of public sector Steel Authority of India (SAIL).
Like the Tata Motors’ proposed unit in Singur, the steel plant will spawn many ancillary units that have a huge potential to generate jobs.