Mr. Sajjan Jindal, Vice Chairman & Managing Director, JSW Steel Ltd, began his career in 1984 by independently looking after the Western region business of steel manufacturing of the OP Jindal group. A Bachelor of Mechanical Engineering from Bangalore University, he serves on several civic society bodies. The immediate Past President of Assocham, he is a Member of the Board of Airports Authority of India, Member, India Council for Sustainable Development, Member, Advisory Committee – Teri School of Management, Member – CII National Council and Council Member – Indian Institute of Metals. In 2009, Mr. Jindal was awarded the prestigious 19th Willy Korf/Ken Iverson Steel Vision Award at the Steel Survival Strategies XXIV Conference for elevating JSW Steel amongst the selected few global steel producers.
JSW Steel Limited, belonging to JSW Group, part of the OP Jindal Group, is one of the lowest cost steel producers in the world. The group has diversified interests in carbon steel, power, mining, industrial gases, port facilities, aluminium, cement and information technology. JSW is engaged in the manufacture of flat and long products viz. HR Coils, CR Coils, Galvanised products, auto grade / white goods grade CRCA Steel, Bars and Rods. Incorporated in 1994, it has grown to US $5 billion in fifteen years. The company has the largest galvanising and colour-coating production capacity in the Country and is the largest exporter of galvanised products, with a presence in over 100 countries across five continents. The company has plans to expand its capacity to 32 million tons per annum by 2020 by setting up Greenfield projects of 10 million tons per annum each in Jharkhand and West Bengal.
Anil Mascarenhas of IIFL gives you the highlights of a media interaction at Vijayanagar, Bellary, where Sajjan Jindal says, "Our Vijayanagar Plant has a production capacity of 7mtpa and it will become 10 mtpa capacity plant in 2011, making it the single largest Integrated Steel Plant at a single location in India."
Illegal mining appears rampant in Karnataka. What is your view?
Anything that is illegal must be stopped. It is not good for society. We don’t want our next generation to simply dig the earth and export. We should build industries. What the Yeddyurappa government has done is correct. There are not many supporters even in the media. He has restricted iron ore from moving out of the state.
There is enough iron ore available if mines are not given to traders and new players. The priority and first-use of iron ore should be for making steel rather than exporting. The government should tell the mine owners to build steel plants. Let the government ban exports in a phased manner by maybe 20% every year. A calibrated ban is the only way.
By 2020, the Indian steel industry should be able to produce 200mn tons of steel for which ~400mn tons of iron ore is needed. At present the iron ore available may be around ~200mn tons. I cannot subscribe to the view of accepting export of iron ore and import of finished steel from China.
But other countries also export iron ore.
If you are talking about countries like Australia, they have a population that matches just about that of Haryana. They do not need the resource internally. India has a population well over a billion and we need houses, we need infrastructure. We need to produce steel for the same, not export iron ore.
What is the advantage or incentive for iron ore mine owners to export?
The biggest advantage in exports is you can under-bill. On account of the exports, the local industry does not get preference. In our case, JSW Steel is land-locked in terms of location. We are very far from the port and have to depend on local iron ore
By under billing on exports, the money finds its way in real estate etc. Steel companies are professionally run companies. We invest money into the company. The term ‘mine-owner' itself is wrong because the mines are owned by the Government. However, the government earns a very small amount unlike the mine operator who pockets most of the gains. The workers in the mines work under terrible conditions. They are underpaid and not provided basic things like even shoes to wear while on the mines.
What if mine allotments are given to new players in the state?
We are following archaic laws, which is The Mines Act of 1952 where miningleases are granted on a `first-come, first-serve' basis, I strongly believe before giving any allotment to new players, JSW Steel, which has done the biggest investment in the state and has the largest employees, should get priority.
Secondly, even in other parts of the country, why should foreign players get any preference or special treatment? Posco is given more importance in India than any other steel company. I will take recourse to legal action; I will fight it out in court if foreigners are given a better deal; it is my right as a citizen of this country.
I have met the prime minister and conveyed our grievances. In fact, a delegation of steel companies including us is scheduled to meet the Prime Minister to discuss our grievances.
To what extent have you suffered due to the political developments in the state?
We do not get involved with the political parties. If we have suffered, it is only on account of the steel market.
Any plans to raise debt?
We have no plans to raise debt. In fact we are looking at reducing our debt.
Is there a possibility of a price rise in August? Inventory levels had moved higher. What is the scenario now?
As prices have stabilized, I do not expect any price increase in August. The demand pool has been increasing so we are seeing a reduction in inventory. The higher inventory was just for a couple of months.
Environment protection is the buzzword. To what extent do you get affected by environmental regulations?
Development of the country and protection of the environment must go hand in hand. Off late, it has been tough getting environmental clearances; a host of approvals and compliance issues have to be dealt with and the industry is feeling the pinch. At the same time, we have to admit that the industry is probably not as disciplined as it should be. We tend to sometimes go ahead expecting the approvals to fall in place sooner than later.
You’ve just commissioned the new Hot Strip Mill (HSM) facility. Which new segments can you now service?
Our Vijayanagar Plant has a production capacity of 7mtpa and it will become 10 mtpa capacity plant in 2011, making it the single largest Integrated Steel Plant at a single location in India.
This is the first time Mitsubishi Hitachi Metals Machinery's technology has been used in India. The commissioning of new HSM facility at Vijayanagar will enable us to introduce high value products for the automotive sector and specialized steel for the energy sector in India, in addition to strengthening our processes in line with global benchmarks.
The new mill has 2250 mm width and a 1.5 mm – 25 mm thickness range, widening the product basket. The increased product basket will facilitate Company’s entry in high-value products including carbon structure steel, high quality carbon steel, IF steel, low alloy steel, API steel (X-80) and structural steel for high growth segments such as oil & gas, shipbuilding & tubing, automotive sector (dual phase steel and trip steel) among others.
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