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Tata Steel's global footprint is spreading at a furious pace. The company has received approval from the Iranian government to set up a three million tonne steel project with an investment of over Rs 6,000 crore (Rs 60 billion).
Iran has allotted 500 hectares in the Persian Gulf Special Economic Zone at Bandar Abbas for the gas-based steel plant.
A Tata Steel spokesperson confirmed the development and said the Iranian Mines & Mining Industries Development & Renovation Organisation had issued permission for supplying raw material for production.
The three-million-tonne plant could be scaled up to five million tonne at a later stage. Once commissioned, it will scale up the combined capacity of Tata Steel-Corus to 28.5 million tonne.
The plant would be commissioned within 36 months from date of start of work, which has not yet being announced. Company sources said the work would begin upon receipt of all approvals.
The proposed greenfield project in Iran is a part of Tata Steel's strategy to have 100 million tonne capacity by 2015. The company has lined up greenfield projects in Jharkhand, Chhattisgarh, Orissa and Bangladesh as well.
The Iran plant would be an export-oriented unit and fully owned subsidiary of Tata Steel.
Analysts said with limited progress in iron ore mines allocation on the domestic turf, Tata Steel could well use the Iran facility to supply semi - finished products to Corus, which has a 19 million tonne production capacity.
However, the Tata Steel spokesperson said it would be premature to comment on whether the unit will supply slabs to Corus.
Tata Steel had chalked out a long-term strategy of deintegrated production, where primary steel making would be in countries rich in iron ore, coal, or gas and finishing facilities would be in growing markets. Corus, NatSteel, Millennium Steel and the various greenfield projects are part of this strategy.