With Steel Authority of India Limited (SAIL) dragging its feet on making an investment commitment, the government of the southern Indian state of Telengana has decided to invite private sector steel companies to set up a steel mill linked to the Bayyaram iron ore reserves in the region, a Telengana government official said on Thursday, May 19.
The official said that SAIL has not responded to the state government’s invitation to construct a steel mill and is said to be having reservations over the quality and quantity of iron ore available at Bayyaram in Telengana.
The Telengana government had invited the Indian government-owned steelmaker SAIL to construct a 3 million metric ton per year steel mill, but the latter has claimed that the estimated 200 million metric ton iron ore reserve at Bayyaram is not viable for such a plant and has not followed up any further, the official said.
Under these circumstances, the Telengana government has had no other option but to invite private sector steel producers to implement the project, as a steel mill is critical for development of the iron ore belt in the province, he said.
Among the options to attract privately-owned steel mills, the Telengana government could pursue a steel mill project with JSW Limited which has already shown interest in constructing a pelletization plant linked to the Bayyaram reserves, the official added.