Months ahead of completing Bokaro plant’s capacity addition to 5.7 million tonnes (MT), Steel Authority of India Ltd (SAIL) on Monday said it plans to raise it further by another 10 MTPA with an investment of Rs 60,000 crore in the second phase.
The investment, which is excluding the ongoing Rs.6,000-crore outlay for the Bokaro plant, would be the highest among five integrated steel mills where the company plans expansions in order to take overall capacity to 50 MTPA by 2025.
SAIL has around 14 MTPA hot metal capacities now. With the current phase of ongoing expansion at a cost of Rs 72,000 crore, this would go up to 24 MTPA.
The additional 26 MTPA capacity creation to meet the target of 50 MTPA by 2025 needs Rs 1.7 lakh crore investments in the second phase.
“This 26 MTPA addition in about 12 years will be financed through internal accruals and market borrowings,” Chairman C S Verma said.
He said SAIL is preparing a roadmap for expansions in other plants in the next phase of expansion.
SAIL’s plan to ramp up capacity to 50 MTPA is in line with the Government’s vision to augment domestic crude steel production capacity from 90 MTPA to 300 MTPA by 2025.
The state-owned steel maker is pinning hopes on rising steel demand from the country’s rural area to support its capacity addition.
“There is a lot of potential for growth of the steel sector in India as our per capita domestic steel consumption of 55 kgs per year is lower compared to global average,” he said.
The planned $ one trillion investment in infrastructure sector during the 12th Plan Period was expected to be a big catalyst for growth in the steel sector, he added.