Mittal Steel To Invest $8.7 Billion In New India Steel Plant

"We are committed to investing around 400 billion rupees (US$8.7 billion) in India," Mittal chairman Lakshmi Mittal told a news conference in New Delhi, after announcing in eastern Orissa state earlier July 7 the investment in a 12-million ton plant. This will be the first Indian operation of the Netherlands-based company, which acquired European steelmaker Arcelor late last month in a $32.5 billion deal.

Mittal did not specify whether the money would be spent on a plant in ore-rich Orissa state or in neighboring Jharkhand, where the Indian-born industrialist had previously said the company would set up a plant. Earlier July 7, Mittal told reporters in Orissa state that the proposed plant will be completed in two phases.

South Korean steel giant POSCO is also building a $12 billion steel plant in the state, which has an estimated one-fourth of the country's iron ore reserves. India currently produces about 35 million tons of steel.

"We (Mittal Steel and Arcelor) shared our vision and found both companies are looking at China and India for expansion," said Mittal.

Mittal's company has a joint venture with India's state-run Oil and Natural Gas Corporation of India Limited (ONGC). The joint venture has operations in Syria and Nigeria.

The Mittal-Arcelor deal will create a group with 320,000 employees producing about 116 million tons of steel a year or about 10% of the world market.

Copyright Agence France-Presse, 2006

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