Don't be distracted by hurdles in India: SAIL to Posco, Mittal | business | Hindustan Times
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Don't be distracted by hurdles in India: SAIL to Posco, Mittal

business Updated: May 30, 2010 12:46 IST

PTI
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India's top steel producer's SAIL on Sunday advised global players Posco and ArcelorMittal to be patient and not be distracted by hurdles in doing business in India.

"I can only say there are always initial problems, hurdles in doing business in India and those who did not really get distressed by the initial difficulties have got success," SAIL Chairman S K Roongta told PTI when asked what would his advice be to the likes of Posco and ArcelorMittal.

Both the global steel players have been waiting to set shop in India, although agreements to this effect were entered into as early as 2005.

Roongta, who retires this month after about four decades in SAIL including the last four years as Chairman, said that his company was talking to ArcelorMittal and Tatas for adding to capacity that is targeted to reach 60 million tonnes by 2020 from about 14 million tonne now.

On the upcoming Rs 15,000 crore joint venture with South Korean giant Posco for setting up a 1.5 million tonne steel plant in Jharkhand, Roongta said: "We are not handholding Posco in India. We have joined hands with Posco for the technology."

Posco and ArcelorMittal proposed to set up mega steel plants with combined investment of Rs 1,50,000 crore but are unable to make much headway due to delays in necessary clearances and protests against land acquisition in Orissa and Jharkhand.

Roongta, who kick started the Rs 70,000 crore expansion project to add about 9 million tonne of capacity by 2012 to become a 23 million tonne company, said the problems faced by foreign players were different in nature than those faced by the PSU.

"I would say one thing to their credit that they were trying to set up shop in greenfield capacities, while we are going for brown field expansions. So there is a difference to that extent. So I would not compare the two situations," he said.

On whether he would suggest these companies to be more patient while doing business in India, Roongta said, "who am I to give advice... Why should I give sermons to anybody? They know their business well no one has asked for advice... I will not say anything further."

On SAIL's efforts to forge joint venture with many of these competitors, he said discussions were on with Mittals as also Tatas. "They add value proposition for us. But there is no concrete shape. With Tatas we already have a joint venture for developing coalmines. Maybe through that venture or otherwise we can always think of collaboration in steel side."