The Steel Authority of India Limited (SAIL) has entered into a 26:74 joint venture with Jaiprakash Associates for producing 2,2 mn tonnes of cement. The venture will spend Rs. 600 crores to set up the new plant. SAIL will hold 26% stake in the venture while the balance will be held by Jaiprakash. The clinker and partial grinding unit of the plant would be located in Satna in Madhya Pradesh and slag cement would be made in Bhilai in Chhattisgarh. The project is expected to be completed in 37 months.
Two unique things about the project are that, firstly, this is the first of its kind public-private partnership in the cement sector. Secondly, SAIL’s foray into cement production is important as cement prices have shot up in wake of demand overshooting supplies. The country’s current cement production capacity is 165 mn tonnes. About 30 mn tonnes of new capacity is expected to be added in a couple of years. SAIL currently sells slag to cement companies through medium-term contracts but the exercise is not enough for a total disposal of its stocks. The JV would enable the company for more productive use of the waste generated by it while producing steel.
The JV would use slag generated from SAIL’s Bhilai Steel Plant as basic feed for cement production, and has already signed a 30-year agreement with the Bhilai Steel Plant for supply of slag. SAIL is also looking at using its slag generated from Bokaro Steel Plant for conversion to cement.
Read The Economic Times article.
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