Odisha's bauxite reserves to attract more than INR 30,000 cr in next few years

It may be early yet, but there seems to be signs of revival in big ticket investment in Odisha's aluminium sector. If recent announcements are anything to go by, the state, home to more than half of India's bauxite reserves, is poised to attract investment worth well over INR 30,000 crore in the next few years.

While engineering major Larsen & Toubro (L&T) said it is hopeful of getting final clearances for its estimated INR 12,000 crore greenfield refinery project, public sector major National Auminium Company (Nalco) said on Monday it has committed INR 20,550 crore for expanding its alumina refinery at Damanjodi and setting up an aluminium park at Angul.

Natural resources giant Vedanta Ltd also said it will sign a MoU with Odisha for an aluminium park, expected to garner investments of INR 1000 crore.

"The entire value chain of Nalco, starting from bauxite mining to aluminium making is based in Odisha, our major focus is to strengthen the investment climate of the State, thereby boosting Odisha's industrial upsurge," Tapan Kumar Chand, Nalco chairman said, during the Make in India (MII) investors' meet.

"Besides rich mineral and water resources, Odisha has good road, rail and port connectivity. On the ease-of-doing-business index, the state is bracketed with the best. The state is also dotted with engineering & management colleges, Diploma & ITI institutes, to source skilled manpower," he said.

Similarly, L&T is planning to set up a 3 million tonne (mt) refinery in the state's Rayagada district. "We had submitted the proposal to the (Odisha) government and we hope we will get the last mile clearance in next 2-3 months," L&T's senior executive vice-president (power, minerals and metals) Shailendra Roy, said on the side lines of the MII Week in Mumbai. The L&T project, conceived in 2005 in joint venture with Dubai Aluminium, was planned as INR 30,000 crore venture with a 1.5 mt smelter and a captive power plant. However, it went into a limbo before getting revived around two years back.

"The investments of INR 12,000 crore will be made in phases," Roy said. L&T will start with the process of land acquisition, designing, once the final approval is in place, he added.

Top consultants like R Muralidharan, senior director, Deloitte in India feel the investor interest in aluminium is linked to predicted growth in power, building and construction, packaging and transport sectors that is estimated to raise the white metal's demand. "A higher awareness among consumers about aluminum's environment friendly qualities, vis-avis plastics, could also be fuelling its demand," he said.

Explaining the reasons behind renewed investor interest in Odisha aluminium sector, Abhijit Pati, CEO-Aluminium, Vedanta Limited said: "The medium to long term outlook for aluminium production in Odisha is extremely positive. Availability of coal, another important raw material for the smelters, easy proximity to domestic markets, a large coastline that gives quick access to ports and export markets, make Odisha a favourable destination for downstream industries." Earlier in the day, Vedanta Ltd said it will sign a MoU with Odisha to commission an aluminium park at Jharsuguda. The project, will provide direct and indirect employment to 17,000 people and come up adjacent to Vedanta's 1.6 mtpa smelter which also has 3600 MW of power generation facilities. The state government will provide necessary infrastructure for setting up the industries like land, electricity etc., the cost of which will be recovered from potential investors.

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