Despite the political turmoil, Delhi based Bhushan Steel has decided to scale up the capacity of its proposed steel project in Bengal to 6 million tonnes, irrespective of a partnership with Japan’s Sumitomo Metal Industries.
Bhushan Steel sources said that discussions with Sumitomo are on but it is not yet confirmed. Discussions with Sumitomo were on for a while about investing in the Bengal project. Bhushan had set a timeline till December for Sumitomo to decide on the project.
However, Bhushan Steel had decided to set up a 6 million tonne in Bengal against the original plan of a two million tonne integrated steel project with a captive power plant.
Source said that “If the partnership with Sumitomo materializes then the six million tonne will be expedited, otherwise we will do it in phases.” It added that additional land would not be required for the increased capacity.
The land requirement for the original project was 2,500 acres. Sources indicated that the company would squeeze in six million tonnes in the same land in the Bardhaman district. The change in plan had been communicated to the state government.
The changes in the project would have to be incorporated in the memorandum of understanding with the West Bengal government. The source further said that “We will rework the MoU. We are waiting to see whether Sumitomo invests in the project because then that will have to be incorporated in the MoU.”
Sumitomo happens to be a technical partner in Bhushan Steel’s Orissa project. The investment in the original Bengal project was estimated to be INR 8,800 crore, which also included a 0.5 million tonne cold rolling and galvanizing plant for automobile grade steel. However the changed size of the project implied that investment would more than double.
