"The kind of macro-economic environment which has come suddenly, now...is allowing us to pause and be cautious." Talking exclusively to Asian News International, Vijay Kumar Bhatnagar, the Chief Executive Officer-India of ArcelorMittal, said that the ArcelorMittal's India plans got halted due to the ongoing turmoil across the world and could be pushed ahead.
"No... it will not go as planned because we had not anticipated this imposed macro-economic condition. So we have to pace our project with the reality which is surrounding us. What that reality will be, only time will tell because it's changing everyday. So that's why we have to align ourselves with how things emerge," Vijay Kumar Bhatnagar said.
ArcelorMittal has plans to invest 20 billion US dollars in setting-up two Greenfield projects in Orissa and Jharkhand states to up its global production capacity by 20 million tonnes to 130 million tones by 2012.
Bhatnagar's statement coincides with a massive lay-off of 9,000 administrative staff by ArcelorMittal from its global operations. The steel-giant has also announced to cut its production capacity by 30 per cent in the fourth quarter globally to address the unprecedented downturn in demand.
The demand for steel is presently on a decline in India as well due to sluggish demands from real estate, automobile and consumer durables.
"There is no point putting-up a plant when demand is not there. So we have to adjust the pace of our project that it produces when the demand is there," Vijay said.
On the government's protectionist measures, Vijay said, "Putting in export duty or import duty, these are, in a way, protectionist measures. Beyond a particular point, I think the protectionism doesn't help. In short-term, somebody may gain benefit but over a long-term, protectionism does not help."
To protect the Indian steel producers from the dumping of cheaper steel from China and other countries, the Government at the Centre had earlier imposed a five per cent import duty on steel.
ArcelorMittal is today the largest steel company in the world, with 310,000 employees in over 60 countries. The company was formed in 2006 by the merger of Arcelor and Mittal Steel. It ranks 39th on the 2008 Fortune Global 500 list.
The company is headquartered in Luxembourg City, the former seat of Arcelor.ArcelorMittal is a market leader in automotive, construction, household appliances and packaging.
It holds sizeable captive supplies of raw materials and operates extensive distribution networks. By Ashwani Upadhyay