Abu Dhabi, Jan. 9
LARSEN & Toubro is initiating a number of business initiatives this year in the UAE in a bid to expand its presence and boost business from the current $400 million to nearly $1 billion in the Gulf and West Asian region in three to four years.
A full-fledged facility for assembly and execution of low tension switchgear and power and motor control centres, a fabrication facility for large sized structures and equipment and an engineering centre are among the slew of projects planned.
Mr A.M. Naik, Chairman and Managing Director of L&T, who is in Abu Dhabi to launch the initiatives, told presspersons that the UAE would be made the headquarters for an aggressive foray in the Gulf region, where the potential and atmosphere for doing business was excellent. He anticipated that one-third of its growth in the Gulf would come from business ventures and contracts in the UAE.
L&T was currently assessing the scope for the projects and scouting for alliances. The projects should get under way before the end of the year, he said. L&T is targeting the West Asian region, Africa, CIS (particularly Kazakhstan) and China as part of its global expansion, Mr Naik said. The company will have three area offices in UAE, Oman and Saudi Arabia to cover the West Asian region, while offices have already been established in Malaysia, Kazakhstan, East Africa and Shangai. Plans are also on to launch operations in West Africa and open a second office in China at Beijing, he said. The moves are aimed at increasing L&T's overseas turnover from the current 17 per cent (Rs 17,000 crore) of total turnover to 30 per cent over the next five years, he told Business Line.
L&T recently bagged a $160-million order from China and is looking at business of $200 to $250 million in Africa in the coming period, he added. Mr Naik stressed that L&T would be definitely interested in returning to Iraq to take up projects once the situation turned conducive. He also hoped to carry out a couple of projects this year in Iran, where an office has been set up.
L&T Infotech is looking for business opportunities in the Gulf region. The company has also bagged an order in Saudi Arabia and is planning to offer its IT expertise in the oil and gas sector to major companies in the region. L&T is also exploring opportunities in India and in other countries with partners in the UAE for joint development of large projects. L&T officials will hold talks with officials of Dubal, (Dubai Alumnium Company) during the current visit for partnering a major $1-billion alumina joint venture project in Orissa that has been proposed by the Dubai company, the sources said. Alcoa, a US based supplier, is also said to be interested in teaming up for this project.
Meanwhile, among other initiatives in the UAE, L&T is working on qualification for a higher level of projects, ranging from $100 million to 200 million in the oil and gas sector. It is also tendering for major electrical and civil engineering projects. It currently has $250 million worth of projects being executed in the UAE, including building of four bridges on the Palm Jumeirah, construction of a process platform for Bunduq Company in Abu Dhabi and a gas compression facility for Gasco. L&T is also executing a critical section of an oil platform for Qatar Petroleum, while several projects have been taken up in Oman, including the recently completed road bridge interchanger in Muscat and an open cycle power plant in Salalah. Several projects have also been taken up in Saudi Arabia and Kuwait and the company is currently building a 430 metre, six-lane cable stayed bridge in Amman, Jordan and a major hotel in Bahrain.