Bhushan Steel & Strips has decided to set up an integrated steel plant with a capacity of 1.2 million tonnes per annum. The project is likely to entail an investment of Rs.2,800 crore.

This would make the company one of the top five steel makers in the country with a total capacity of over 2.3 million tonnes.

The new hot rolled coil plant will be set up at Durgapur in West Bengal. The company has dropped its earlier plan of setting up a plant in Orissa and a processing unit at Haldia in West Bengal.

Bhushan is a major customer of HR and CR coils from Steel Authority of India for conversion into GP/GC sheets. The proposed plant at Durgapur will reduce its dependence on basic material from primary producers. In the first phase, Bhushan will be setting up a sponge iron plant with an investment of Rs.550 crore, which will then be integrated with a blast furnace and hot strip mills. Bhushan is in talks with SMS Demag of Germany for setting up the mills. Bhushan is also looking at iron ore mining leases in Orissa for its Durgapur plant.

Bhushan has sought a 16-year sales tax waiver for its proposed Durgapur plant. It may be noted that West Bengal’s industrial policy of 1999 automatically allows a nine-year sales tax holiday for new investments, which in special cases have been relaxed upto 12 years.

Bhushan is also constructing a new 0.4 million tonne GP/GC plant at Maharashtra, while its Uttar Pradesh unit processes around 0.55 million tonnes of CR coils and GP/GC sheets.