SAIL to ink pact with Steel Complex

Staff Reporter

Memorandum of Understanding for joint venture later this month

The two companies to be equal shareholders in the venture

By 2015, country expected to be the second largest producer of steel

KOTTAYAM: Steel Authority of India (SAIL) will ink a memorandum of understanding (MoU) with the Kozhikode-based public sector Steel Complex for a joint venture, Minister for Chemicals, Fertilizer and Steel Ram Vilas Paswan said here on Saturday.

The MoU will be signed in New Delhi later this month.

The once-sick Steel Complex Ltd. had sought the services of SAIL for a possible turnaround and was functioning under its guidance from July last year. The unit is expected to register cash profits this year.

The relationship is expected to strengthen with the inking of the MoU.

The two companies will be equal shareholders in the joint venture.

On the spiralling price of steel, Mr. Paswan said the government had initiated several budgetary measures to help producers bring down their prices.

However, the global prices of raw materials had gone up still further, negating the effects of these measures.

China is experiencing a higher increase in steel prices, he pointed out.

The government has initiated talks with the manufacturers and other stakeholders. The talks are expected to hold the price line and result in price reduction by Rs.2,000 a tonne, he said. Mr. Paswan said the consumption of steel in the country that stood at 56 million tonnes this year was expected to reach 124 million tonnes by 2011 and hit the 350-million tonne mark by 2020.

“While production registered a growth of six per cent, the demand is expected increase by 13 per cent during this period,” he said.

By 2015, the country is expected to become the second largest producer of steel, he said.

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