chapter 4. resources and mining equipment, technology
In India, the Tata brand is ubiquitous, covering everything from salt to motor vehicles to steel. Tata was chosen as the joint venture partner due to its corporate values, local brand recognition, well-established distribution channels and secure sources of raw materials. As an Indian private sector conglomerate, Tata also understands how to work with government in India, where relationships are key
BlueScope offered complementary skills and experience. It had long-established expertise in metal coating and painting technology, marketing skills and customers around the world for its pre-engineered building products
The joint venture produces a range of steel products supplying well-known global brands such as COLORBOND® steel and LYSAGHT®, as well as local brands such as the flagship DURASHINE® steel. The principal market is India's building and construction sector. Economic activity and urbanisation in India has ensured strong local demand for its coated steel building products, as well as demand from across South Asia and around the world
The construction of a metal coating and painting plant ran into some difficulties with significant delays, but Tata Steel's local knowledge assisted with development approvals and local government relations to complete and commission the plant, which has since been operating successfully
The joint venture took a number of years to become profitable and some parts of the business were underperforming and required restructuring. The joint venture partners worked together on a suitable revised business plan and to develop an appropriate approach to deal with the restructured assets
Over the last few years, the joint venture business successfully refinanced term loans and exercised an option for early redemption of debentures. Both shareholders supported the joint venture in its dealings with lenders and regulatory authorities
More than a decade later, Tata BlueScope Steel has six major manufacturing plants across India, employing 550 people, with revenue of around $400 million. Expansion of production facilities is on the cards
Perseverance by BlueScope in India has been important. It took a long term view, and specialised in doing what it knew how to do best. Working with Tata, the right partner in India, has also been key to the joint venture's success
India's demand for resource commodities will continue to grow. Of significance for Australia's areas of competitive strength, India is likely to remain import reliant for metallurgical coal, gold, and copper out to 2035
India's National Steel Policy 2017 sets a highly aspirational steel consumption target of 255 million tonnes per annum by 2030 (India's crude steel production is currently around 100 million tonnes). This would require around 196.4 million tonnes of metallurgical coal per annum – an expected growth in demand of 4–5 per cent per annum from 2016 to 2030
While India is looking to diversify its import sources, Australia will remain well-positioned to meet India's continued strong import demand, given the high quality of our metallurgical coal and that we are India's top supplier by a considerable margin42
Supported by India's growing refining capacity, India's import reliance on copper will likely remain above 90 per cent as demand continues to grow at a steady pace. Future demand growth is expected to be in the range of 5–6 per cent per annum.12
Hundreds of millions of years ago, Australia and India were both part of the ancient super-continent Gondwana. Today both nations share geological similarities and Australian geoscientists can apply their knowledge and experience in the Indian context
As India becomes more urbanised, and demand for mineral resources grows, understanding regional geology, and being able to predict the potential for undiscovered mineral deposits, is becoming increasingly important
India has an ambitious vision to develop its vast mineral resources, and to do so needs a modern exploration and mining sector. Geoscience Australia is using its internationally recognised technical expertise to assist the Geological Survey of India in becoming a world-class geoscience organisation
Through a Memorandum of Understanding, Geoscience Australia is building the capacity and technological capability of the Geological Survey of India to assess the potential for minerals deep underground. It is holding ‘train the trainer' workshops in India, inspecting equipment and facilities, and seconding Indian officers to work inside Geoscience Australia
Collaboration has mutual benefits for Australia and India. Through its engagement with Geoscience Australia, India is also set to draw on the expertise of Australian universities, Australian geoscience contractors, and the mining equipment, technology and services sector more broadly
India has scant domestic gold reserves to meet this demand. Imports are either in refined or doré (partially refined) form. Doré imports have grown as the Indian Government has sought to incentivise domestic refining while imposing import restrictions on bullion imports
Australian gold exports are primarily in bullion and Australia competes with South Africa as the primary producer of gold exports to India, with Swiss traders and to a lesser extent the United Arab Emirates and the United Kingdom as the largest exporters
The increasing adoption and use of new technologies, including environmental technologies, will mean India will require commodities such as critical metals and rare earth elements, of which Australia has reserves
India is one of the 10 or so countries that also has its own rare earth reserves and active mining projects. The Indian Government is trying to promote rare earth mineral exploration and production from a very low base. If India looks to increase its rare earth refining capabilities out to 2035, there may be the opportunity for partnership with Australia
Out to 2035, there are good growth opportunities in the value and volume of our metallurgical coal, copper, and gold exports to India. Attracting Indian investment into the Australian resource sector can bring in capital and create jobs. For India, vertically integrated investments into Australia can help smooth commodity price volatility. As India's exploration and extraction continues to grow, so too will opportunities for Australian METS companies. However, the well-trodden pathway for Australian METS companies to follow Australian resource majors into markets is unlikely to eventuate in the Indian market
India's demand for METS will grow out to 2035, particularly in connection to those commodities for which India is prioritising greater domestic output, such as thermal coal where Coal India has big and sophisticated aspirations [see Chapter 7: Energy Sector]
Beyond coal itself, there will be opportunities in advanced Indian mining projects for exporters of mining IT, planning software, safety, health and risk management technologies and methods, and training in all its forms
The projected growth in India's METS sector offers Australian firms, a large number of which are SMEs, the opportunity to increase participation in Indian supply chains through research and development collaboration and joint ventures
Although manufacturing products in India could help Australian products compete in the price-sensitive Indian market, any sort of large-scale METS manufacturing hub is unlikely, as Australia manufactures only certain niche products and little by way of automated equipment
A number of Australian METS companies have an established local presence, or use a local partner, in India. This investment, while modest in overall dollar terms, has the potential to grow and create Australian company clusters
7*24 all day long
zhengzhou,china
