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Rediff.com  » Business » Tatas may shelve Bangladesh project

Tatas may shelve Bangladesh project

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December 10, 2005 13:21 IST

The Tata group may shelve its proposed Rs 5,000 crore (Rs 50 billion) Bangladesh project if it does not get the required concession from the local government.

Tata Sons director J J Irani said that the proposed projects of Tata Steel and Tata Chemicals critically hinged on the availability and pricing of gas in Bangladesh.

"If we do not get it at a price which we are looking at there is no point (in) doing the project. This is simple because Bangladesh does not have iron ore. So, the only advantage is gas," he said.

The Bangladesh government was reportedly not willing to give gas at a concessional rate to the group. However, the group is confident that its telecom business would be in the top league among other group outfits in five years.

The telecom business is likely to start making money in another two-three years, felt Irani. "The telecom should join the big league of Tata Steel, TCS and Tata Motors - the top three profitable entities of the Tata group," Irani said.

He also made it clear that Tata Teleservices (TTSL) would eventually be merged with Tata Teleservices (Maharashtra). "This (the merger) is going to happen but when we cannot say," Irani added.

TTSL, which had been incurring losses, should tide over gradually in the coming years. TTML, which operates in the Maharashtra circle, was in a comparatively better financial position hovering around the break-even, but was yet to establish as a profitable venture on a sustained basis.

Tata Motors, Tata Steel and TCS are the top three companies of the group in terms of turnover and profit. Tata Motors tops the turnover chart of the group, while Tata Steel heads the profit chart.

Earlier, commenting on the steel scenario, Irani said he opposed the export of high grade iron ore from the country, saying the raw material should be given to those who would make steel in india.

"The availability of ore with 60 per cent and more iron content is limited in India and this ore should be given to the people who will make steel in India," he said.

Irani further said, "If companies like Posco and Mittal Steel come, give them this ore for as long as they make steel in India, but this ore should not be exported."

He said steel makers in Europe were using ore with about 35-40 per cent iron ore content.

BS Bureau in Kolkata
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