ArcelorMittal JV Plans Rs 1.4-Trn Steel Plant In AP

The Andhra Pradesh govt is looking at providing around 1,800 acres of land adjacent to Nakkapalli bulk drug park

Bengaluru: In a significant boost to investment in Andhra Pradesh, global steel giants- ArcelorMittal and Japan’s Nippon Steel- are planning to set up a Greenfield steel project of 17.8 million tonne (MT) with a proposed investment of Rs1.4 lakh crore in Anakapalli district of Andhra Pradesh.

ArcelorMittal and Nippon Steel will set up the plant through a joint venture-AM/NS India. The mega steel plant of 17.8 million tonne will be established in two phases, sources said. During the first phase, AM/NS India will establish a 7.3 million tonne per annum production capacity blast furnace steel plant with an initial investment of Rs80,000 crore. Subsequently, the second phase of the project will be executed. The foundation stone of the steel plant is likely to be laid in early 2025 by Chief Minister N Chandrababu Naidu. This is one of the biggest investment proposals in the sector in recent time.

Interestingly, the proposed investment plan has come at a time when the Union Steel Ministry has infused around Rs1,640 crore in loss-making Rashtriya Ispat Nigam Ltd (RINL), the corporate entity of Visakhapatnam Steel Plant (VSP) for its revival.

It is said that AM/NS India has sought 2,600 acres of land for setting up the first phase of the steel plant. For executing the second phase, AM/NS has requested for an additional 2,000 acres of land.

The Andhra Pradesh government is looking at providing around 1,800 acres of land adjacent to Nakkapalli bulk drug park as it is readily available for transfer. Subsequently, more land will be provided as the project progresses.

Arcelor Mittal has been scouting for suitable locations in Andhra Pradesh and Odisha for setting up an integrated steel plant for quite sometime now. As availability of port, ample water source & raw material are critical for setting up a Greenfield steel project, the current location of Nakkapalli fulfils all the criteria and is seen suitable for establishing a mega project.

Clinching of such mega project for Andhra Pradesh also has an interesting background. According to sources in the know, State’s IT Minister Nara Lokesh took several personal initiatives for bringing the mega steel project to Andhra Pradesh after knowing about the interest of both steel majors to set up units in India. Nara Lokesh connected with Arcelor Mittal’s CEO and billionaire scion Aditya Mittal virtually in July after understanding the company’s requirements for setting up such a unit in the State. After a fruitful discussion, the final agreement came when Chief Minister N Chandrababu Naidu and Lakshmi Mittal spoke about the nuances of project, giving green signal to the proposed plant.

India is the second largest producer of crude steel after China with a production capacity of around 125 million tonne per annum.