MercoPress. South Atlantic News Agency

India sets foot in Bolivia with giant steel/iron project

India's Jindal Steel and Power has won the contract to mine and process the rich Bolivian iron ore deposit of Mutun, next to the Brazilian border, an investment in the range of 2.3 billion US dollars, announced Bolivia's Planning and Development Minister Carlos Villegas

The awarding of the contract "signals the unprecedented establishment of the steel-making industry in Bolivia, and definitively breaks with our history of exporting raw materials" underlined minister Villegas.

Jindal has 60 days to fulfill the legal requirements prior to the signing of the contract. The Mutun deposit, in southeastern Bolivia near the border with Brazil, is estimated to hold some 40 billion tons of iron ore, along with manganese and other minerals. Among other conditions, the bidding requirements specified that natural gas, which abounds in Bolivia, must be used in the refining process.

Last week, Bolivia announced that the British-Dutch multinational Mittal Steel, the other firm still involved in the bidding for Mutun, was excluded due to what were deemed insufficient or unacceptable conditions.

Last month, the new Socialist administration of President Evo Morales, fresh from nationalizing the country's vast reserves of gas, excluded the Brazilian company EBX from the Mutun bidding.

It also forced the company to write off its investment in works begun last year with the argument that it violated Bolivian regulations since the company was planning to use coal instead of natural gas as fuel.