Bolivia has secured the largest pledge of foreign investment in its history, after the country signed a 2,1 billion US dollar (11,55 milliarder DKR) deal with Jindal Steel and Power, an Indian steel company, to exploit a huge iron ore deposit.
The agreement marks the first big investment by an Indian company in South America, a region whose mineral, oil and gas deposits have attracted interest from Chinese and Russian companies in recent years.
Bolivian Mining Minister Luis Alberto Echazu said that this was the “largest mining contract in the history of the republic” and it confirms the governments policy of finding partners, not patrons, to exploit the countrys natural resources.
Meanwhile, Jindal vice president Vikrant Gujral said that his firm had been developing the El Mutun project since 2004, and he thanked Bolivian President Evo Morales for having shown his willingness to work to achieve an agreement with the firm.
The deal gives Jindal rights to exploit half the 60 square kilometers site for 40 years. El Mutun, which lies near the Brazilian border, is estimated to contain iron ore reserves of more than 40 billion tons.
Jindal said the company was not going to bring the iron ore to India as this would not be economically viable. India has iron ore reserves of about 23 billion tons and is the world’s third-largest exporter. Jindal said the company would develop an integrated steel plant with an annual capacity of 1,7 million tons in Bolivia, which would start up by 2010.
The project is expected to create as many as 21.000 jobs both directly and indirectly related to the mine. The government in La Paz earlier reported the project would benefit the state with some 200 million dollar in yearly tax revenues and premiums.
Kilde: www.worldbank.org
