Global steel giant ArcelorMittal has committed $25 billion investments in India. Approximately $20 billion is being invested in two steel plants, each with a capacity of 12 million tons per year, currently being set up in Orissa and Jharkhand. The two plants are expected to be commissioned in 2011-2012. About $500 million has been earmarked for Corporate Social Responsibility programs, which include rehabilitation and resettlement of the villagers affected by the steel projects.
ArcelorMittal India Limited intends to buy equity stakes in two joint-venture companies. In a joint venture with the GVK Group, it plans to acquire a 55 percent stake in the Seregarha Mines in Jharkhand. In another joint venture, ArcelorMittal India plans to buy a 13 percent stake in Rampia Coal Mines and Energy in Orissa with GMR Energy Limited, Navbharat Industries, Lanco Infratech Limited, Reliance Energy Limited, and Sterlite Industries India Limited. The coal will be used in the two 750-megawatt (MW) power projects being built at the site of the new steel plants.
ArcelorMittal Stainless and Nickel Alloys has formed Innovative Clad Solutions, a joint venture with India's Shivalik Bimetal Controls Limited and Germany's Auerhammer Metallwerk Gmbh. The joint venture was created with an initial investment of $12.7 million to set up a metal cladding unit with a capacity of 10,000 tons per year. The products will be used in automobile parts, bearings and heat exchangers. The unit will be set up in the Special Economic Zone of Indore, Madhya Pradesh, and is expected to become operational by April 2009.
ArcelorMittal India has approached Coal India Limited with a proposal to form a 50:50 joint venture. With ArcelorMittal's expertise in advanced coal-mining technology, the new company could venture into the utilization of abandoned mines and unexplored coal reserves. Having an adequate supply of domestic coking coal will decrease the steel industry's dependence on imports.
ArcelorMittal has also expressed an interest in forming a partnership with Reliance Industries Limited to start a surface coal gasification project, subject to government approval.
The company has submitted a bid in response to a global tender for a joint venture floated by India's largest iron ore producer and exporter, the state-run National Mineral Development Corporation, to develop National Mineral's existing and new mining assets in the country and abroad.
ArcelorMittal is also talking to a Chennai-based steel maker about forming a joint venture to manufacture stainless steel for the automobile industry.
The company recently signed a landmark deal with one of the world's largest producers of iron ore and pellets, Vale. Under this new long-term contract, Vale will supply iron ore and pellets to ArcelorMittal's steel plants in Africa, the Americas and Europe. This is the largest-ever contract signed between an iron ore supplier and a steel company. Vale will supply approximately 480 million tons of iron ore and pellets over the next decade. The value of this landmark deal is yet to be disclosed.
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