Midal Cables' Rs. 3.6 bn investment on Odisha aluminium park in jeopardy.
May 15, 2018
Odisha's aluminium park project at Angul, jointly promoted by National Aluminium Company (Nalco) and state-owned Odisha Industrial Infrastructure Development Corporation (Idco), has run into trouble. Bahrain-based investor Midal Cables has resented the lack of a long-term commitment in molten aluminium supplies by Nalco, jeopardising the fate of its Rs 3.58 billion investment committed on the downstream park.
�"Midal Cables wants uninterrupted molten aluminium supplies for 25 years. Their annual requirement is 25,000 tonnes. Nalco is constrained to commit supplies for 25 years, it has offered to provide molten aluminium for five years under an arrangement. Unless Midal Cables get a word on the long-term investments, they would not be keen to hold on their investment,� said a source close to the development.
Nalco's chairman & managing director T K Chand was not immediately available for comments.
Nalco has earlier promised to provide 50,000 tonnes each year to all downstream units who install their units at the aluminium park. The aluminium major is also providing a discount of Rs. 5,000 per tonne on aluminium ingots and Rs. 4,000 a tonne on molten metal. More, Nalco is offering its brand name to the products of the downstream units. To make land costs viable for investors, Idco has offered to allot land at Rs five million per acre instead of Rs six million. The string of incentives make the Angul aluminium park a globally competitive cluster .
Midal Cables has proposed to set up a rod & wire conductor unit at the park with an annual capacity of 60,000 tonnes. Grid Conductors Ltd., a subsidiary of Power Grid Corporation of India Ltd. (PGCIL), has proposed to establish an aluminium and aluminium alloy conductor unit in Odisha, committing an investment of Rs. 1.27 billion.