Raipur, Oct 8 (IANS) Lafarge India Pvt Ltd has signed a deal to invest Rs.5.1 billion (about $115 million) for expanding its cement production unit in Chhattisgarh.
'Lafarge India signed a memorandum of understanding (MoU) on Friday with the Chhattisgarh government to bring in Rs.5.1 billion for its Sonadih plant in Raipur district,' Chhattigarh Industry Minister Rajesh Munat told IANS.
The Sonadih plant's existing annual production capacity is 1.4 million tonnes per annum (mtpa) that will go up to 1.6 mtpa after the expansion that is likely to be completed by December 2007, said Munat.
Chhattisgarh's Bharatiya Janata Party (BJP) government had turned down the MoU offer of Lafarge India, a subsidiary of French cement giant Lafarge Group, in May this year amid public protests against cement manufacturers who had raised cement prices by 25-30 percent.
Munat said the state government would provide all support to Lafarge India for its expansion project, as it would create more jobs in the state.
Lafarge, which commenced operations in India in 1999 by acquiring the Tata Iron and Steel Company's (TISCO) cement unit, has a total production capacity of five mtpa in the country from its three plants - two based in Chhattisgarh and one in Jharkhand.
Munat added that Raipur Allies Steel Ltd (RASL) had also inked a deal with the state government for investing Rs.7.2 billion for expanding its steel plant in Siltara, located on the outskirts of capital Raipur.
According to officials, industrial houses have signed dozens of MoUs since November 2004 with the Chhattisgarh government for investing at least Rs.460 billion in the state mainly in the steel and power sector.