NEW DELHI, Sept 10: Steel giant Arcelor Mittal said on Wednesday delays in obtaining approvals for its two Indian plants had pushed up costs by 50 per cent but the company was still committed to investing in the country.

Arcelor Mittal, the world’s largest steel firm, said its planned integrated steel plants in mineral-rich Orissa and Jharkhand states were facing big cost overruns due to delays in getting mining, land acquisition and other approvals.

“When we started, we estimated they (the two plants) would cost about $20 billion,” Arcelor Mittal chief executive officer Lakshmi Mittal told reporters in the Indian capital.

But “there has been a delay for two years so costs have gone up by 50 per cent,” he said. “The more the delay, the more the cost overruns.” The steel tycoon’s statements came as India slipped two notches to 122 out of 181 countries in the World Bank’s annual global ranking of the easiest places to do business.

At the same time, India-born Mittal, who was in New Delhi for a company meeting, said Arcelor Mittal was “still very excited about our (eastern) Indian projects” and added he “was emotionally committed to the country.” Analysts say Arcelor Mittal is keen on using low-cost facilities in emerging markets to cut production costs.

Neither Arcelor Mittal’s experience nor the bitter dispute over the building of a Tata Motors plant in West Bengal slated to produce the world’s cheapest car detracted from India’s appeal as an investment destination, Mittal said.

A slew of Indian business leaders have warned that violent demonstrations demanding return of farmland acquired for the Nano car plant in Marxist-ruled West Bengal will damage the country’s investment allure.

“One can face this kind of problem in any other country,” Mittal said. “But the country as a whole is interested in growing.” He said he had no idea when the plants, which would have total capacity of 25 million tons annually, would get the green light, but the company had set up an office in Kolkata and “whenever we have approvals the projects can move fast.” In the meantime, Arcelor Mittal was working with local communities to explain the training and job benefits of the projects, he said.

“This is not a one-way process... this will reduce the anxiety of the people,” he said.

“India has never seen this kind of investment in the infrastructure,” he added.

Large industrial projects, which Indian politicians say are vital to creating jobs in the country of over 1.1 billion people, have faced huge local opposition with farmers objecting to loss of their land.—AFP