Salem Steel to have SEZ

New Delhi: Steel Authority of India Ltd on Saturday signed a memorandum of understanding with Infrastructure Development Corporation (IIDC), a wholly owned subsidiary of IL&FS, to develop a steel sector special economic zone at Salem in Tamil Nadu. SAIL and IIDC would form a special purpose vehicle within a month to carry out the operations, with each entity holding equal amount of shares in the proposed venture.

According to a statement from SAIL, the application for approval of the SEZ would be submitted to the Central Government and was likely to be considered by the Board of Approvals of the Ministry of Commerce in October.

The proposed SEZ would be developed in an area adjacent to SAIL’s existing steel plant at Salem. Through this venture, SAIL would gain in the form of assured demand for customised steel products from upcoming units in the SEZ. According to the MoU, SAIL would provide land and IIDC will provide advisory and other related services for the SEZ. The company also expects to obtain benefits allowed to an SEZ developer in the form of land lease rentals, tax concessions and earnings from provision of services in the area.