By Gyanendra Kumar Keshri
New Delhi, June 16 (IANS) Steel magnate Naveen Jindal-led Jindal Group's $2.1 billion projects in Bolivia, including an upcoming steel and power plant, will create thousands of jobs and transform the country's economy by accelerating industrialisation and boosting growth, a company official said. This is the largest investment by an Indian firm in South America.
The company has pledged to invest the $2.1 billion over the next eight years on mining and on setting up an integrated 1.7-million-tonne-per- annum (MTPA) steel plant, a six- MTPA sponge iron plant, a 10- MTPA iron ore pellet plant and a 450-MW power plant in the South American nation. Of this, Jindal Steel and Power, a part of the $15 billion diversified O.P. Jindal Group, plans to invest about $600 million over the next two years.
For a country of 10 million people with a GDP of just $18 billion, the $2.1 billion investment is a huge one, accounting for nearly 12 percent of its GDP. The sheer vision and size of the projects have made Jindal a household name in Bolivia.
Naveen Jindal, executive vice chairman and managing director of Jindal Steel and Power Limited, is on a week-long visit to Bolivia to review the progress and speed up work on the projects.
"We have already secured land and started work on the project. Ground work is ready and now construction is going on," the company official, who said he would not like to be identified because of company policy, told IANS.
The official said the company hopes to start steel production in Bolivia by 2014.
In 2007, Naveen Jindal, who is a Congress member of the Lok Sabha, the lower house of the Indian parliament, signed an agreement with the Bolivian government for the development rights for 20 billion tonnes of iron ore reserves at Bolivia's El Mutun mine.
"Jindal steel is the talk of the town all over Bolivia from El Mutun where the mine is located to Santa Cruz, the provincial capital, and to La Paz, the capital of Bolivia," said R. Viswanathan, India's Ambassador to Argentina, Uruguay and Paraguay.
"At Santa Cruz airport, you can just tell the taxi driver to take you to the Jindal office and need not worry about the address. They all know it. The only thing is you have to say Hindal since J is pronounced as H in Spanish," said Viswanathan, who specialises in Latin American affairs.
There is no Indian embassy in Bolivia, which is bordered by Argentina, Brazil, Chile, Paraguay and Peru. However, India has consulates in La Paz and Santa Cruz.
Jindal's $2.1 billion proposed investment will be the largest foreign infusion Bolivia has ever received. In fact, it will be the first steel plant established in the country.
"It will contribute to the industry, economy and export earnings of Bolivia, besides to the exchequer by way of taxes and royalty. It will provide jobs and training to thousands of Bolivians, " said Viswanathan.
Jindal Bolivia, a wholly owned subsidiary of Jindal Steel and Power, plans to export one million tonnes of iron ore concentrate from the El Mutun mine.
Jindal is also involved in the development of infrastructure in Bolivia. This includes the repairing of nearly 100 km of the road that connects El Mutun with a canal linking the Paraguay and Parana rivers, as well as with a major river port that will provide access to the Atlantic Ocean.