With its copper smelter at Tuticorin in Tamil Nadu getting environmental clearance, copper major Sterlite is set to enhance its production capacity by a whopping 66 per cent: from 180,000 tonnes to 300,000 tonnes annually.
Analysts say the hike in capacity will catapult Sterlite into the number 1 spot in terms of copper production, and number 6 globally.
However, observers caution that the ranking may change as Birla Copper, the other big player in the copper space, too is increasing capacity. Hindustan Copper Ltd, the state-run public enterprise, has also received a grant from the government for expansion.
Cash-rich Sterlite will use funds generated on its own steam for the expansion.
The company says that the reason for the expansion is the rising demand for copper both in India and China, which is a big buyer of copper.
Despite the sudden spurt in production, Sterlite does not foresee a fall in prices or a slowdown in sales as the market is expanding at a rapid pace.
The company is confident that by 2010 -- even if it is not the biggest copper producer in the world -- it will be the cheapest producer of copper worldwide. The copper-maker has already won several awards for efficiency and total quality management.
Sterlite officials held prayers at the Tuticorin smelter on Friday to mark the beginning of the expansion process.
The delay in obtaining environmental clearance was due to the green bodies showing strong opposition to the company's plans to lead the waste into the sea. Sterlite will now store the waste in cement tanks inside the company's premises.
Officials say that with increase in production, waste will also increase, but that too will be stored in the cement tanks.
Sterlite has not announced any long-term plans about what it will finally do with the toxic waste.
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