Tata Steel Ltd plans to invest in last-mile rail connectivity and building specially-designed wagons. This is in the backdrop of the company's growing logistics requirement as it expands its operations.
logistics spend
The logistics spend of the Tata Steel Group worldwide stood at Rs 6,390 crore in 2010-11, a growth of 15 per cent over the previous year. Out of this, the company incurred an expenditure of Rs 1,541 crore for its Indian operations.
“We are considering various options to invest in last mile rail-link connectivity…We would also look at investing in specially designed wagons to carry more payload,” Mr Amitabh Panda, Group Director (Shipping and Logistics Operations), Tata Steel Group, said.
He was speaking on the sidelines of a logistics conference, organised by mJunction Services, a joint venture of Tata Steel and SAIL, here on Friday.
However, Mr Panda did not divulge specific details of the proposed investments.
Policies for pvt investment
The Indian Railways has designed policies to invite private investment in last mile rail linkages.
It has also formed policies allowing companies to invest in specially designed wagons.
By investing in rail lines to link its upcoming projects, Tata Steel hopes to lower logistics cost and improve efficiencies. Tata Steel is currently implementing a mix of Greenfield and Brownfield capacity expansion projects.
The brown field project in Jamshedpur involves increase in crude steel capacity to 9.7 million tonnes a year (mtpa) from 6.8 mtpa.
The company is also setting up a 6 mtpa green field expansion project at Kalinganagar in Orissa.
Besides, it is developing a port in Orissa at Dhamra along with L&T.
The first phase of the project is complete and the commercial operations have begun.
The company has set up a 62 km rail-link from Bhadrak to Dhamra except commissioning of automated signalling system.