Question : AGREEMENT BETWEEN SAIL AND JP GROUP



(a) whether Steel Authority of India Ltd. and J.P. Group of Industries have entered into any agreement for setting up a cement plant;

(b) if so, the details thereof;

(c) the time by which the proposed plant is likely to be set up;

(d) whether the Government has formulated any scheme to set up more cement plants in order to check the increasing cement prices; and

(e) if so, the details thereof?

Answer given by the minister


MINISTER OF THE STATE IN THE MINISTRY OF STEEL (DR. AKHILESH DAS)

(a)&(b): Yes, Sir. Steel Authority of India Limited (SAIL) and M/s. Jaiprakash Associates Ltd. (JAL) have entered into an agreement to set up cement plants at Babupur Satna, MP and Bhilai, Chattisgarh in a Joint Venture Company with equity participation in the ratio of 26% & 74% respectively. The clinker and partial cement making will be at Babupur Satna in Madhya Pradesh. The balance cement making will be at Bhilai in Chattisgarh. The capacity of the plant is about 2 MT and is expected to cost around Rs.600 crores.

(c): As per the terms of the agreement, signed on 21st March, 2007, the Cement Plant is to be commissioned within 37 months from the date of agreement i.e. by April, 2010.

(d)&(e): Under the liberalized economic environment, cement manufacturing is free from industrial licensing and the investment decisions are taken by entrepreneurs based on techno-economic consideration. The Government is encouraging capacity addition in the private sector by providing a conducive environment. Presently, the prices of cement are determined by market forces depending upon factors like demand and supply, distance from manufacturing centre, local taxes, imposed by the State Governments etc.