With the ongoing Euro crisis and a steep decline in the European demand Tata Steel is now turning to Asia and Africa for growth prospects.
"Steel plants are being closed or moth-balled to conserve costs and to control over-supply," chairman Ratan Tata said in a statement in the company's annual report, referring to the failure of steel consumption in the West.
"By contrast, the demand for steel is still buoyant in Asia and Africa where growth rates and investment levels are higher than the West and where new sources of iron ore and coking coal are being developed," he said.
Tata steel has already a coal mine in Mozambique and the company is further planning to set up a plant in Vietnam. The company has also its operations in China and Thailand.
The company said by 2014, the company would attain a global capacity of 33.5 million tonnes adding another three million tonnes after the full completion and implementation of the Odisha project.
Tata Steel's new 6 million tonne per annum capacity plant is under construction in Odisha.
In addition to that, the 2.9 million tonne expansion project planned for Jamshedpur is likely to go onstream this fiscal, which will increase the production capacity of the plant to 9.7 million tonnes.
According to him, the demand for steel in India is constantly good and, in fact, continues to outstrip supply.
"Unfortunately, major greenfield projects which would substantially increase domestic steel capacity are facing enormous delays due to hurdles in land acquisitions and approvals for the necessary mining rights to feed these new plants."
Steel demand in India is expected to grow vigorously keeping in view the significant need for infrastructure and increasing urbanization.
-With inputs from IANS
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