Since 1982, Tapan Kumar Chand, the CMD of National Aluminium Company (Nalco), has been serving the mining and metal sector. His over three-decade stint includes the director— commercial of Rashtriya Ispat Nigam /Visakhapatnam Steel Plant and director personnel and director of Central Coalfields. These years of experience give him the confidence over the Indian metals market. He believes that Nalco will not be impacted directly with the current geopolitical concerns. In an interview with Free Press Journal’s Jescilia Karayamparambil and R N Bhaskar, Chand discusses the future plans for the company.Since 1982, Tapan Kumar Chand, the CMD of National Aluminium Company (Nalco), has been serving the mining and metal sector. His over three-decade stint includes the director— commercial of Rashtriya Ispat Nigam /Visakhapatnam Steel Plant and director personnel and director of Central Coalfields. These years of experience give him the confidence over the Indian metals market. He believes that Nalco will not be impacted directly with the current geopolitical concerns. In an interview with Free Press Journal’s Jescilia Karayamparambil and R N Bhaskar, Chand discusses the future plans for the company.
Many would view US tariffs on aluminium with a bit of alarm. But your view is different, why?
The United States has increased the tariffs on aluminium to 15 per cent and steel to 25 per cent. So naturally, it would be hurting exports from China and other countries to the US. It will have some indirect impact on us, but our exports to the US is quite less — only 1.25 lakh tonnes. That is just 10-12 per cent of our exports. We do not expect any direct impact.Having said that, the aluminium consumption of the US is very high. They only produce 1.5 million tonnes (mt) of aluminium while their consumption is 5 mt. They have to necessarily buy it from Asian markets because production levels are high in China, India and other Asian countries. Some kind of moderation is likely to come there. We are expecting some change. As the president of the Aluminium Association of India, we are asking the government to seek exemption for India as we export very small quantities and hence do not affect the US industries significantly.
Are you looking at new markets globally for aluminium?
We are producing auto-grade aluminium and that will have a strong market in America and the European Union.
In your vendors and customers meet, there was a feedback that Nalco needs to improve the quality of higher grades of aluminium. Your view?
The customers were mainly talking about special grade aluminium. In the case of calcined alumina we are the best. The biggest players like Rio Tinto Alcan and Norsk Hydro also purchase from us because of our quality. As for the special grade aluminium is concerned there is a problem with our plant and we are trying to revamp that. Then the quality of such grades will also improve. But the demand for the product is minuscule as we produce only 15,000-20,000 tonnes. We are going to shut down the plant and rectify the issue with that plant very quickly.
What is the progress in the mega park plans?
We are going for a mega expansion of Rs 30,000 crore. In that park, we will have an aluminium refinery at Damanjodi, then we will have smelter which will be a brownfield project. There will be expansion in terms of the power plant as aluminium is extremely energy intensive. There will be a cluster of downstream units that could opt to receive molten aluminium and other expansion plans. These are also other new expansion projects that are coming up. We are expanding into specific based production.In case of caustic soda, we will be going in for a joint venture. We are trying to have one more JV with Gujarat Alkalies for caustic soda. The talks for this JV are at an advanced stage. This JV will produce 2.4 lakh tonnes of caustic soda.
What kind of activities are you looking for on the renewable energy front?
We are having 198 MW of wind power plant. We have one plant at Sangli in Maharashtra and two in Rajasthan and one in Andhra Pradesh. We are commissioning one in Tamil Nadu soon. In case of wind, we are one of the leading players but in case of solar we are just starting. As you know, the market has become turbulent with prices falling, so we are taking cautious decision. When we make investments in such projects, you need to make some returns.
But Nalco will be a captive consumer of this energy?
We can be but we will have to wheel it. There are lots of restrictions. But we are taking it up with the parties concerned to sort this out soon.
With so many electric vehicles and smart city projects coming up, how will it ramp up consumption?
Once Train-20 (A trainset is a set of coaches coupled mechanically and electrically with driving cabins at both ends and distributed traction power across the train) becomes a success, there will be a huge consumption of aluminium. In addition to this, there will be a huge consumption by electric vehicles, smart cities and rural electrification. These projects will drive consumption in future. I am projecting that in next 7-8 years our consumption is likely to double. We are having 1.25 billion people, and it is projected to touch 1.6-1.7 billion by 2021. This shows the demand coming from domestic market.
Where does India stand in terms of aluminium consumption?
India’s growth of aluminium industry is much better. The consumption is growing at 8 per cent.
Other major highlights for Nalco
- In Q1 2019, the company is looking at Rs 460 crore advantage as one of its coal mines will open then.
- The company saw 100 per cent growth in profit in 2017-18.
- There is 2022-23 roadmap prepared and the company is working in that direction.
- Nalco is concerned with domestic market.
- By 2023, the company expects the domestic consumption to be 10 million tonnes.