October 12, 2008

SAIL, NMDC and Indian railway to ink agreement for rail link in Chattisgarh

It is reported that proposal for a rail link in Chattisgarh to ease the movement of iron ore and finished steel for the Steel Authority of India Limited and National Mineral Development Corporation is finally moving forward after decade long discussions.

As per report, both SAIL and NMDC are expected to sign a cost sharing agreement with the Chattisgarh government and the Indian Railways next month to fund the project. Mr RS Pandey union steel secretary said that the Indian Railways would execute the project and the state government will acquire necessary land to build the rail line.

The planned 235 kilometer long Dalli to Rajhara to Jagdalpur rail line project, part of the South East Central Railway, first proposed in 1995, is estimated at more than INR 1,000 crore.

SAIL access to the ore mines in Rowghat, with a reserve of 500 million tonnes, located 80 kilometer from its plant in Bhilai. SAIL’s existing mines at Dalli to Rajhara have reached an exhaustion point and will close down within 4 years and SAIL is seeking fresh allocations to meet its demand.

NMDC, which now largely depends on the Kottavalasa to Kirandul line, connecting its operating mines in Bailadila in the southern part of the state to Visakhapatnam in Andhra Pradesh, will also gain market access in central India. NMDC will have the option of an alternative route to transport iron ore.