Skip to content
Search

Latest Stories

Vedanta lost £159m in profits in one year of India plant closure: Anil Agarwal

VEDANTA LTD has lost about $200 million (£158.90m) in profits ever since its copper smelter plant in India was shut more than a year back after police fired on protesters and killed 13 people, group chairman Anil Agarwal said.

Agarwal added that the stoppage of production at the Tuticorin plant of the firm's unit Sterlite led to the country having to import copper, spending precious foreign exchange.


"We have lost about $200m in bottomline (profits)," he said in an interview.

"Forget about bottomline. How can you stop production and start importing? After all, what we did at Tuticorin was import substitution", he added.

The Tamil Nadu government had in May last year ordered permanent shutdown of the copper smelter after bloody protests at the plant in Thoothukudi culminated in police opening fire on demonstrators.

Vedanta wants the plant to be reopened, pointing to the economic pressures from the closure.

As many as 20,000 direct and indirect jobs have been lost due to the shutting of the smelter and about 98,400 more were affected in the consumer or downstream industries.

"It is a bread and butter issue for Tuticorin," he said.

"What happened (in police firing) was very unfortunate and our thoughts and sympathies are with the victims. But what is now happening is equally unfortunate."

The Vedanta plant in the Thoothukudi district of the southern Indian state of Tamil Nadu produced about 40 per cent of India's copper output.

The company had announced a plan to expand capacity, leading to protests on concerns about pollution. Vedanta denies that the factory has been a polluter.

He sought to draw a parallel between Tuticorin and Singur in West Bengal which was abandoned by Tata Motors in 2008 after protests over its Nano car factory.

"Nobody can (afford to) make another Singur," he said without elaborating.

In 2008, Tata Motors abandoned plans to build a factory to make the world's cheapest car after protests led by politicians over land acquisition.

That pullout was said to have deterred many manufacturers from investing in new plants in the state.

Tamil Nadu, one of the most industrialised states in India, is home to factories of companies like Hyundai Motor and Caterpillar.

But it has in recent months seen a decline in foreign investment, leading to concerns about job creation.

"I have been saying and will repeat again - the world does not want us to produce. World wants us to import," he said, adding the shutting down of Tuticorin plant has led to India importing copper.   Agarwal hoped that a solution will be found soon.

According to Vedanta Ltd's latest annual report, the Tuticorin copper smelter, operated by its Sterlite Copper business, ranks as one of the largest custom copper smelters in India.

With a design capacity of 400,000 tonnes, the business held 33 per cent market share of the country's refined copper demand of around 675,000 tonnes in the financial year 2018, it said.

The company challenged the closure order through an appeal before the National Green Tribunal (NGT), which in December 2018 ruled that the Tamil Nadu government's order was "nonsustainable" and "unjustified".

However, in February 2019, the Supreme Court set aside the NGT's order on the grounds of maintainability and directed Vedanta to file a writ petition before the Madras High Court.

The company has filed a petition in the high court and "the matter is likely to come up after the summer vacation break," Agarwal said.

Vedanta Ltd in its annual report for 2018-19 said: "India faced a crunch in the availability of refined copper due to Vedanta's Tuticorin smelter closure. Chinese smelter output increased by 4.2 per cent in 2018, despite the closure of some smelters for maintenance during Q4."

Refined copper consumption in India grew by 2.9 per cent in 2018 while demand in China, the largest consumer of copper, increased by 4.9 per cent, it said.

Refined copper is predominantly used in manufacturing cables, transformers and motors as well as castings and alloy-based products.

"In the coming year, copper consumption in India and China is expected to increase by 11.8 per cent and 1.6 per cent respectively. This rise is driven by population growth, urbanisation, the rise of the middle class and the evolution of electric vehicles (EVs)," it said.

On the supply side, there could be further disruptions in copper production due to the smelter upgrades in Chile following the introduction of new environmental regulations.

"Our ability to take advantage of these opportunities is largely dependent on the re-opening of our smelter at Tuticorin," it said.

Data from the International Copper Study Group showed refined output and demand growth estimates for 2019 indicating a market deficit of 280-kilo tonnes, it added.

(PTI)

More For You

modi-trump-getty
Modi shakes hands with Trump before a meeting at Hyderabad House in New Delhi on February 25, 2020. (Photo: Getty Images)

India open to tariff cuts on £17.7 bn worth of US imports: Report

INDIA is considering cutting tariffs on more than half of US imports valued at £17.7 billion as part of ongoing trade negotiations, two government sources told Reuters.

The move, which would be the most significant tariff reduction in years, is aimed at countering reciprocal tariffs.

Keep ReadingShow less
tata-steel-green

Artist’s impression of Tata Steel’s state-of-the-art Electric Arc Furnace facility being built in Port Talbot. (Image credit: Tata Steel)

Tata Steel

Tata Steel hires local firms for Port Talbot project, creating 300 jobs

TATA STEEL has appointed three South Wales contractors to support its £1.25 billion investment in green steelmaking at Port Talbot. The contracts will create over 300 skilled jobs in the local supply chain.

Bridgend-based Darlow Lloyd & Sons will oversee excavation, recycling, infrastructure, and drainage work for the transition to Electric Arc Furnace (EAF) steelmaking.

Keep ReadingShow less
 Survey Reveals More Britons Reducing Everyday Spending

About 43 per cent of consumers said they were cutting back on everyday purchases, while more than a third reported increasing their savings as a precaution. (Photo: Getty Images)

Getty Images

Survey shows more Britons cutting back on everyday expenses

CONSUMERS in the UK are reducing spending on everyday items as confidence in the economy declines ahead of chancellor Rachel Reeves’s spring statement, according to a KPMG survey.

The survey, conducted among 3,000 UK consumers, found that 58 per cent believed the economy was worsening in the three months to February, up 15 percentage points from the previous quarter, The Guardian reported.

Keep ReadingShow less
23andMe

Many users trusted 23andMe with some of their most sensitive personal information

Getty Images

DNA data of millions at risk as 23andMe declares bankruptcy

The recent Chapter 11 bankruptcy filing by genetic testing company 23andMe has raised serious concerns about the privacy and security of the DNA data of millions of users. Founded in 2006, 23andMe has long been a leader in consumer genetic testing, offering individuals insights into their predisposition to various diseases and the possibility of connecting with unknown relatives. However, with the company now seeking buyers in bankruptcy proceedings, the sale of this genetic data has become a source of alarm for privacy advocates and experts.

Many users trusted 23andMe with some of their most sensitive personal information, their DNA. However, as the company faces financial struggles, privacy experts warn that the future handling of this data may be far less secure. Tazin Kahn, CEO of the nonprofit Cyber Collective, which promotes privacy and cybersecurity for marginalised groups, expressed deep concern about the potential consequences. “Folks have absolutely no say in where their data is going to go,” she said. “How can we be so sure that the downstream impact of whoever purchases this data will not be catastrophic?”

Keep ReadingShow less
uk construction

The construction sector accounts for around 6 per cent of gross domestic product and supports growth in other industries.

iStock

Government pledges £600 million to address construction skills gap

BRITAIN will invest £600 million to train construction workers and address skills shortages that could affect its plan to build 1.5 million homes by 2029 and support economic growth, the government announced on Saturday.

Housebuilding and infrastructure development are central to the Labour government’s growth strategy. The construction sector accounts for around 6 per cent of gross domestic product and supports growth in other industries.

Keep ReadingShow less