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Home > Business > Business Headline > Report

Ispat links up with Bechtel for Iraq deals

Ishita Ayan Dutt in Kolkata | May 20, 2003 13:02 IST

Ispat Industries has registered itself with Bechtel Corp, which has bagged a $680-million contract for a reconstruction project in Iraq, in a bid to secure a role in the rebuilding of the war-ravaged country.

Ispat Industries director Vinod Garg said Ispat has already registered as a global supplier and contractor database of Bechtel.

"We are in touch on a regular basis," he said. The contract is to be completed in 18 months.

Bechtel had also won the contract to rebuild Kuwait after the first Gulf war in 1991.

The Bechtel contract does not contain any 'buy American' provisions, which implies that the global company was likely to source material from most convenient and cheapest sources except six countries  -- Cuba, Iran, Laos, Libya, North Korea and Syria.

Even domestic downstream suppliers would not have to be accommodated and this is where the opportunity for India lies.

Garg said, since India was a regular supplier on merit before the war, Ispat expected a good volume of sourcing from Indian manufacturers.

However, the industry feels that the initial demand would come in for long products. Garg pointed out, "The initial demand will be for structurals and long products."

The demand for flat products will come in 5-6 months' time once the first phase of infrastructure such as sea ports, airports, electric power system, road networks, rail systems, municipal water and sanitation services and school and health facilities were in place.

The industry expects the surge in demand for steel due to Iraq reconstruction to last for the next 2-3 years as the total rebuilding of Iraq would take some 3-5 years.

Bechtel National Inc would host a contractor-supplier conference towards the end of the month to inform the worldwide contracting community of its role in USAID's Iraq Infrastructure Reconstruction Programme.

An Essar Steel spokesperson said, "We will decide in the next one or two days whether to send our representative. We are eyeing the Iraq market for our construction and steel businesses."

At the conference, presentations about tendering and subcontracting processes and requirements would also be made.

The topics include insurance requirements, performance securities, collecting expressions of interest, determining bid lists for specific programs and job orders, tendering and tender evaluations.

The Tata Steel spokesperson when contacted said, no enquiries have come in for reconstruction, as on date.


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