Hyderabad: Ras Al Khaimah, one of the kingdoms in the United Arab Emirates, plans to set up an aluminium plant near Visakhapatnam in Andhra Pradesh at an investment of $2 billion (Rs8,800 crore). The state has huge reserves of metallurgical-grade bauxite, the raw material to make aluminium.
The investment will be split into an alumina plant with a capacity of 2.5million tonnes and a 250,000-tonne aluminium smelter facility. Ras Al Khaimah proposes to complete the project, expected to employ directly and indirectly around 10,000 people, within 36 months after receiving regulatory clearances, the state government said in a release.
Construction of the plants will start in August and be completed in or before 2010, Khater Massaad, chief executive of the state-controlled Ras al-Khaimah Investment Authority, said in the statement.
Ras Al Khaimah has entered into a memorandum of understanding with the AP government, which has assured supply of bauxite for the project.
The state has bauxite reserves in Chintapalli and Jerrela areas of Visakhapatnam and Gurtedu area of East Godavari district. The Andhra Pradesh Mineral Development Corporation will mine bauxite for the Ras Al Khaimah plant. APMDC estimates the bauxite reserves in the areas at 305mt.
APMDC has agreed to supply 224-million tonnes of bauxite from Jerrela area to the Ras Al Khaimah plant on a long-term lease. The pricing of bauxite will be decided by a high-level committee of bureaucrats.
The aluminium company would allocate 0.5% -- equivalent to Rs 12 crore every year -- of its turnover for the tribal development in the region. APMDC will also allocate 20% of its profits from the bauxite-mining project to tribal projects. The state government expects to receive an amount of Rs40 crore a year towards royalty. The government expects tax revenues of Rs120 crore per annum from this project.