Tata's Kalinganagar plant to start production by 2014

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Tata Steel, the world's eighth-largest steelmaker, is expecting to commission the first phase of its proposed six-million-tonne per annum (mtpa) greenfield plant at Kalinganagar in the second half of 2014, a company executive said.

"In the first phase, the steel plant would start with three million tonnes per annum capacity. It is expected to be commissioned during the second half of 2014, that is anytime between July to December," Tata Steel Ltd. vice president, Anand Sen told reporters here Saturday evening.

On the current status of the project, Sen said: "A very large proportion of our orders are already placed. More than 55 percent to 60 percent of the orders is in position."

The six million tonnes project of Tata Steel, a part of the sprawling Tata Group conglomerate, in Odisha's Kalinganagar was earlier budgeted about Rs.35,000 crore. But due to years of delay to start the construction works for the project, the steel major has been incurring a huge cost overrun.

"Forex (foreign exchange) fluctuations and changes in state taxes are the extraneous factors in the cost overrun," the executive said.

The Kalinganagar plant is under construction after eight years of delay.

Tata Steel had signed an MoU with the state government in November, 2004, for establishment of the steel plant. However, the project remained a non-starter for years following the police firing on January 2, 2006, in which at least 13 tribals were killed during a an eviction drive carried out by the police.

The company resumed the construction work at Kalinganagar in September this year after withdrawal of dharna by the local villagers, who had been on agitation, demanding jobs in the project.