SAIL, RINL evince interest to partner NMDC for steel project

NEW DELHI: Two state-owned steel makers -- Steel Authority of India Ltd (SAIL) andRashtriya Ispat Nigam Ltd (RINL) -- have evinced interest to be NMDC's joint venture partner in the Rs 15,525-crore proposed steel project at Nagarnar in Chhattisgarh.

NMDC, which had invited Expression of Interests (EoI) in February from global steel biggies to become a joint venture partner for its three million tonnes per annum (mtpa) project, is likely to invite soon a fresh round of EoI, dangling the carrot of more stake or even management control. 

However, offering the chance to one of the two PSUs is also a option, sources said. Final call on the partnership issue would be taken by the company board at its meeting in the first week of May, they added. 

NMDCBSE 0.93 % had offered to give 49 per cent equity in the project to its prospective partner, not management control. 

Industry officials said NMDC should have learnt from previous experiences between 
SAIL-Posco and NMDC-Severstal, where even 50 per cent equity offer did not break the ice. 

Two separate steel-making joint ventures that SAIL and NMDC had thought of earlier involving South Korean Posco and Russia's third largest steel manufacturer 
Severstalrespectively did not fructify due to tussle over management control. 

"We got just two applications in response to the EoI that we had issued in February. We want wider participation for the steel project from across the world. Hence, we will issue a fresh EoI and hike equity offer," an NMDC official told PTI. 

The tepid response to the proposed project has surprised officials since NMDC's Nagarnar project is free from the hazards of land acquisition. 

There are also no issues on uninterrupted iron ore supply to feed the project since NMDC is the largest producer of the raw material. Thirty per cent work on the project has already been completed as well. 

India is seen as one of the future markets for steel owing to its much below steel consumption than even global average.