InvestorQ : Why is Arcelor Mittal back to setting up a steel plant in the state of Odisha in Eastern India?
Aditi Sharma made post

Why is Arcelor Mittal back to setting up a steel plant in the state of Odisha in Eastern India?

Mahima Roy answered.
1 year ago

There have been a string of proposals to set up massive steel plants in Odisha but many of these plans have also not really taken off. The first was the Gopalpur plant of Tata Steel, which was supposed to take off in Odisha in the late 1990s but never really took off. Then came the 15-year long effort by POSCO of South Korea and here again the company had to finally give up its plans for the steel plant.

However, what did not take off with Tata Steel and POSCO is now likely to be back with Arcelor Mittal, which is the world’s largest steel producer in the world, much bigger even than the steel giants. It remains to be seen if this proposal is able to take off successfully unlike the previous abortive attempts of setting up the steel unit in Odisha. The state of Odisha has advantages like easy access to raw materials and also access to ports.

A memorandum of understanding or MOU has already been signed between the Government of Odisha and ArcelorMittal Nippon Steel. This agreement is for a green-field 12 MT integrated steel plant in Kendrapara district of Odisha. This will entail an overall investment of Rs. 50,000 crores, based on current per tonne estimates for the sector. Odisha CM, Naveen Patnaik, signed the deal with L N Mittal of Arcelor Mittal.

The petroleum minister, Mr. Dharmendra Pradhan, had said earlier that Odisha would be made a nerve centre for the Indian steel sector. As stated earlier, the state has the advantage of easy access to ore mines and also to the ports of Odisha. Massive investments in steel will spur the infrastructure boost in the economy which is a pre-requisite to push Indian GDP to $5 trillion. It also has a high GDP multiplier ratio.