SAIL's expansion drive expected to be done by 2012-2013

State-run SAIL's massive expansion drive to increase its steel production capacity to 21.40 million tonne per annum (MTPA) at an investment of Rs 61,870 crore is expected to be completed by 2012-2013, Parliament was informed today.

In a written reply to the Rajya Sabha, Steel Minister Beni Prasad Verma said that Steel Authority of India's (SAIL) crude steel production capacity will increase from 12.84 MTPA to 21.40 MTPA, while its hot metal production capacity will increase from 13.82 MTPA to 23.46 MTPA.

"The current phase of modernisation and expansion of SAIL is expected to be completed progressively by 2012-2013," he said, adding that the indicative investment is estimated at Rs 61,870 crore.

Besides this, the Maharatna firm has earmarked a Rs 10,264 crore investment to develop its existing iron ore mines, Verma said.

Replying to a separate question, the Steel Minister said, "All major packages (related to the expansion drive) have been ordered and these packages are under various states of execution."

SAIL has embarked upon a major modernisation and expansion drive at its integrated steel plants at Bhilai, Bokaro, Rourkela and Durgapur, besides 100 per cent subsidiary IISCO's unit in Burnpur, he said.

"Apart from increasing production capacity, the modernisation project would also address vital issues such as elimination of technological obsolescence, installing energy-efficient and environment-friendly technologies, etc," the Steel Minister added.

Replying to a question on iron ore exports, Verma said though there is no ban at present, his ministry is of the view that the vital raw material should be conserved for the long-term use of the domestic steel industry.

The government has decided that conservation of iron ore should not be achieved by banning or capping exports of iron ore, but by taking recourse to appropriate fiscal measures, the Steel Minister said.

With a view to conserve iron ore, the government has fixed the ad valorem export duty on iron ore at 20% across the board from March 1 this year, he said.

Of this, the export duty on iron ore fines was raised by 5%, while the hike was 15% in the case of iron ore lumps.