Interview with Chief Executive Officer, Vedanta Resources
The right place to build aluminium smelters is where bauxite, coal and capital are available, Vedanta Resources Chief Executive Officer Tom Albanese tells Kunal Bose. Ideally, there should also be an expanding local market for the metal. Albanese says India has it all. Edited excerpts:
Your chairman, Anil Agarwal, says India has abundant natural resources and demand potential to lift annual aluminium smelting capacity to 20 mt from 4.1 mt. Is he not too optimistic, since a lot of local capacity now remains idle?
The question is, will demand be there in future to support that kind of capacity build-up? For local demand of 20 mt, we have to have a very long-term perspective, pitched on multiple decades of eight per cent annual gross domestic product growth. Now, the issue is: From where will India get that big a volume of aluminium?
Will it buy the white metal from China, which has around 50 per cent share of world production or will there be big enough indigenous capacity to take care of growing demand? I will say local aluminium demand growth stands to get a major boost from the Make in India programme and the renewed emphasis on infrastructure development.
What gives you confidence that India could build that big a capacity?
You require bauxite, cheap energy and capital to build smelters – all in large volumes. India is rich in geological endowments of coal, which, if properly harnessed, becomes a cheap source of electricity and bauxite that is refined into alumina for smelter use. What you don’t have often here is social sanction to open mines and build alumina refineries and smelters. So, the challenge is to break that logjam by upholding the best practices from social and environment perspectives.
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