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Mittal brake on projects

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By The Telegraph Online
  • Published 8.02.12

New Delhi, Feb. 7 (PTI): The world’s largest steel maker ArcelorMittal, which was unable to get regulatory approvals for its proposed $30-billion investments, has for the time being put on hold its India business plans.

“It is very difficult to say any thing... When will we start the construction, when we will really make progress. We are not even counting them in our business plans for the next few years,” ArcelorMittal chief L.N. Mittal said while announcing the results for 2011 in a conference call.

The steel maker has plans to build 2 mega steel plants of 12 million tonnes each in Jharkhand and Odisha, and one 6MT plant in Karnataka at a total estimated investment of Rs 1,30,000 crore ($30 billion).

However, marred by regulatory delays and problems in land acquisition, the company has put its Odisha plans on the back burner. In September 2010, it also shifted its plant site in Jharkhand from Khunti-Gumla to Bokaro.

Noting that ArcelorMittal is still in the process of securing various regulatory approvals, Mittal said his company was waiting for a clear picture to emerge on various government policy initiatives such as the new mining bill.

The new mining bill, tabled in Parliament in the winter session, has proposed to levy an amount equal to 100 per cent royalty payment for the non-coal mining companies as compensation for the project-affected people.

“New bills are coming in Parliament... There is a new policy for coal allocation. So, we are really watching the various developments and rules and regulations (that are) coming in. Then only we will have the visibility about the projects in India,” he said.

Meanwhile, ArcelorMittal’s net loss widened to $1 billion in the December quarter of 2011, mainly because of tax payout, impairments and restructuring charges. The company had reported a net loss of $780 million in the same quarter of 2010.