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The Standing Committee on Coal and Steel has urged Steel Authority of India Ltd (SAIL) to go in for greenfield projects. With private sector players together setting up nearly 100 million tonnes of greenfield capacity, the committee feels even the public sector steel giant should choose this route to stay competitive.
In its report on modernisation and expansion of the steel sector tabled in Parliament, the committee points out that as many as seven private companies are setting up greenfield capacities, and some of the projects are likely to be commissioned by 2011-12.
“Private steel players have proposed huge investments for setting up greenfield projects to enhance their production capabilities. The Committee desires that public steel companies should also consider the feasibility of setting up greenfield projects after completion of first phase of the expansion programme,” the committee's report stated.
Private companies aim to set up almost 31 million tonnes of production capacity by 2011-12. The projects include Tata Steel's Kalinganagar plant in Orissa, Jindal Steel and Power Ltd's plants at Angul, Orissa and Patratu, Jharkhand, Electrosteel Casting Ltd's project in Jharkhand and Essar Steel's Orissa project. A further 68.8 million tonnes of greenfield capacity from private players is set to come up by 2014. However, these projects include the ones planned by ArcelorMittal and Posco, which have faced several delays.
The Standing Committee has also expressed displeasure over delays of SAIL's expansion programme. The committee noted that the company's expansion programme has gone off track and major machinery items such as Coke Oven Battery, Blast Furnace, Basic Oxygen Furnace, Bloom Caster, Continuous Casting have not yet been received by the company.
These delays will lead to the company missing the target date for completion of its expansion projects. “The design, engineering, civil and structural works are also likely to take considerable time for completion which would further hamper the installation of various facilities which have been ordered,” said the committee in its report.
Another reason for delays, the committee points out, is the retendering process undertaken by SAIL because of the high price quoted by vendors of the plant machinery. > d.das@thehindu.co.in
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