New Delhi: Steel Authority of India Limited (SAIL) today signed an agreement for formation of a 50:50 joint venture company with Shipping Corporation of India Limited (SCI). SAIL is India’s largest steel maker and SCI is the country’s largest shipping company. The agreement was signed by SAIL Director (Finance) Mr. Soiles Bhattacharya and SCI Director (Technical & Off-shore Services) Mr. U.C. Grover in the presence of SAIL Chairman Mr. S.K. Roongta and SCI Chairman Mr. S. Hajara.
As per the agreement, the joint venture company (JVC) will primarily take care of SAIL’s shipping needs by owning and operating ships. The JVC, which will be registered at Kolkata and initially cater to around one million tonnes of SAIL's imported cargo annually, will be expanded subsequently.
SAIL currently imports around 10 million tonnes (MT) of coking coal, a major input for steel making, per annum. The company’s requirement of imported coking coal would increase considerably in coming years in view of the ongoing expansion plan of SAIL that will nearly double SAIL's hot metal production capacity from the current level of around 14 MT. The shipping JVC would enable SAIL to have control over part of its coking coal supply chain and effectively assist SAIL in mitigating risks existing in the volatile shipping market.
SCI, which will bring its expertise in the shipping arena to the JVC, is already in the process of acquiring new vessels, and the JV will give its efforts a further boost.
Speaking on the occasion, Mr. Roongta said that SAIL is keenly focused on ensuring its long-term raw material security and will continue to give thrust on logistics facilities and creation of infrastructure for smooth flow of raw materials and movement of finished products.
Picture caption: SAIL Chairman Mr. S.K. Roongta (extreme left) and SCI Chairman Mr. S. Hajara exhanging copies of the agreement for formation of a shipping joint venture company by SAIL and SCI. The signatories to the agreement are seen at the centre: SAIL Director (Finance) Mr. Soiles Bhattacharya (left) and SCI Director (Technical & Off-shore Services) Mr. U.C. Grover.