Mittal gets Cabinet nod for Bhatinda refinery

New Delhi, June 21 (UNI) Steel tycoon L N Mittal's Rs 3,365 crore investment for taking up 49 per cent stake in state-owned HPCL's nine-million-tonne Bhatinda refinery today received the Cabinet nod, paving way for the largest FDI in any PSU refinery.

Christened the Guru Gobind Singh Refineries Ltd (GGSRL), a specially created 100 per cent subsidiary of the Hindustan Petroleum Corporation Ltd (HPCL), needed the Cabinet approval since current government policy restricts FDI in public-sector petroleum refineries to 26 per cent.

The JV will enhance the availability of petroleum products in the north and result in industrialisation and creation of jobs in Punjab, Information and Broadcasting Minister Priya Ranjan Dasmunsi told reporters here.

HPCL would also make a 49 per cent investment in the JV. This would help in the globalisation of HPCL, he said.

The JV would give a new lease of life to the Bhatinda refinery which was languishing despite investment of Rs 24 crore by HPCL, the Minister added.

Petroleum and Natural Gas Minister Murli Deora had yesterday said that the 49 per cent FDI investment of Mittal's in HPCL ''is not a policy change and just one of a kind''.

The investment has been routed through Mittal Energy Investment Pte Ltd of Singapore, a wholly-owned subsidiary of Mittal Investments, Luxembourg.

Mittal Investment had done a detailed legal implication of making the 49 per cent investment through Mittal Energy Investment Pte Ltd since Singapore provides a strong legal and regulatory framework and double tax avoidance treaty while allowing free flow of capital and cross-border transfer of Singapore dollars.

UNI