Kobe Steel, Japan’s fourth-largest steelmaker by capacity, is likely to invest Rs 615 crore ($150 million), to build an iron nugget plant in Goa, along with the Chowgule group. According to sources, Kobe is also likely to rope in a third partner in the project and has kept that option open.
Work for the plant is expected to begin by December this year and about 80% of the investment will be made by the Japanese company, the sources added.
The nugget plant will be developed over 40,000 sq metres of land near Chowgule group’s mines and will have capacity to produce 500,000 tonnes a year. But the venture hasn’t yet resolved issues related to the final output; Kobe wants to export half the produce of iron nuggets back to Japan while Chowgule wants the entire produce to be sold in India.
Earlier in an emailed response to an ET questionnaire, Chairman Vijay Chowgule said: “Kobe through its involvement in the steel business is always looking at new technologies for producing steel. Chowgule being in the business of supplying raw materials for the steel business is also exploring ways to effectively use the products produced in as efficient manner as possible, by the buyers.
This also includes exploring new technologies for producing steel. Our exploration plans are in a very premature stage and we do not wish to make any comment.”
According to Kobe, which is borrowing from the Japanese government-run Japan Bank for International Corporation, half the produce has to be sold in Japan. But the Chowgule group has been insisting on meeting the demand of the growing Indian steel industry. This is delaying the finalisation of the joint venture, said sources.
- Economic Times
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