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ArcelorMittal, the largest steel manufacturer of the world, has plans for exiting the $20-billion proposed steel plants in Jharkhand and Orissa because of delay in acquiring land. Lakshmi Mittal, the chief of ArcelorMittal, has also mentioned that it is looking into other options as well.
"If we cannot make progress in these two sites we will have to abandon the idea of starting the projects there and look for other places in India for our expansion," mentioned Mittal to the British daily Financial Times.
According to Mittal, the delay required for persuading farmers and others were "unacceptable" to the company. He also mentioned that the company will be facing only “negligible” financial loss as the land has not been acquired nor has the construction work been started
ArcelorMiital, which had entered a deal for the acquisition of 35% of the stake in Uttam Galva, an Indian steel manufacturer, had put forward the proposals for setting up steel plants with an output capacity12 million tonnes per annum in Jharkhand and Orissa.
"Lakshmi Mittal is close to pulling out of a USD 20 billion plan to build two large steel plants in India - the centrepiece of efforts by one of the world's most prominent industrialists to expand in the country of his birth," the Financial Times said.
Mittal told FT that the people in India had to be "educated" into supporting gradual industrialisation, including the need to build new steel plants on agricultural land.
"Although Mittal said he was still committed to building at least one steel plant in India, abandoning his plan to have two sites producing between them about 24 million tonnes of steel a year by around 2015 would be a big blow," the newspaper said.
The decision to abandon the said plants would delay by several years Mittal's plans to have a sizeable presence in India.
