Nellore: A Rs. 4000 Crore high end aluminium alloy development and manufacturing facility is being set-up as a Joint-Venture between MIDHANI and NALCO in Nellore District of Andhra Pradesh. Vice President M Venkaiah Naidu will lay the foundation stone on August 26, 2019 at Bodduvaripalem, Nellore District in Andhra Pradesh. Defence Minister Rajnath Singh has invited AP Chief Minister YS Jagan Mohan Reddy to attend the function.
The Vice President has taken a keen interest in the setting up of this plant in Nellore district and has held extensive discussions over the past one and half years with DRDO, NALCO, MIDHANI and others concerned. He also took up the need for early clearance with the NITI Aayog, which finally agreed on the viability of the project after holding discussions with the stake-holders involved in the project.
Venkaiah Naidu also separately spoke to the Chief Secretary of Andhra Pradesh LV Subramanyam, who assured him about the allotment of the Andhra Pradesh Government Industrial Infrastructure Corporation Ltd (APIIC),land for the project. After which APIIC allotted 110 acres of land to MIDHANI in SPSR Nellore for the project.
Following the assurance and allotment of the land, the Vice President held a meeting with NALCO, MIDHANI, Ministry of Mines along with Chairman, DRDO and agreed to lay the foundation stone during his forthcoming visit to the district.
The plant envisages to meet the strategic requirement of defence aerospace and transport applications under the Make-in-India programme and would produce 60,000 tonnes per annum. At present Aluminium Flat Rolled Products (FRP) estimated demand is around 6,50,000 TPA, of which 40 % is being met through imports. It is estimated that the demand in the next five years will increase to 1.5 Mn Tonnes per annum, with a deficit of around 300000 Tonnes, after considering existing production capacity in India.
The proposed plant seeks to fulfill the strategic requirement, fill the estimated deficit and to make India self-reliant in production of critical materials. To meet this end, MIDHANI and NALCO had executed an MoU on April 15, 2017 to set up the 60,000 tonne per annum capacity plant.The plan will also generate direct and indirect employment through ancillary industries.
The proposal for the project was approved by the concerned ministries and concurred by NITI Aayog. Both MIDHANI and NALCO Company Board accorded approval for Joint Venture Agreement (JVA) and the same will be signed this month.
The project is estimated to be completed within 36 months. Financing of the project is proposed with Debt Equity ratio of 70:30. Equity contribution from MIDHANI and NALCO is proposed at Rs. 171 Cr. each which cumulatively works out to 25.10% and the remaining contribution will be made by Technology Partners and /or other Equity participants / through bank by issuing Compulsory Convertible Debentures (CCD) / loans.