The Andhra Pradesh government has settled to select Essar Steel as the joint venture partner for establishing a three million tonne per annum capacity steel plant in Kadapa district.
The state Cabinet withdrew its earlier resolution, made on February 23, selecting Liberty Steel India as the JV partner for construction and development of the YSR steel plant.
With Liberty stuck in fiscal woes, the SBICAP asked the YSR Steel Corporation, the SPV of the state government, that its earlier reference be reviewed and proceed with the next qualifying
The Cabinet considered the proposal and accepted SBICAP's suggestion to take Essar as the JV partner, according to Information Minister Perni Venkataramaiah (Nani).
The project capex of the project is Rs 11,606 crore.
The AP government established the YSR Steel Corporation for development and operation of a new steel plant in Kadapa district and invited proposals in November last from renowned firms for inducting as a joint venture partner.
The proposed steel plant would have a capacity of up to three million tonnes per annum for producing high grade steel products.
The state government already contracted a memorandum of understanding with NMDC for supplying the required 4.5 million tonnes of iron ore every year for the proposed steel plant.
As per the government demand, the plant would offer direct and indirect employment to about 25,000 people.
The state government pooled 3,148.68 acres of land spread over two villages for the joined steel plant, which would now be alienated to the YSR Steel Corporation for Rs 1.65 lakh an acre.