Page 41 - Plastics News March 2017

BUSINESS NEWS

Indian Oil to deliberate on Rs 52,000 crore expansion of Paradip refinery

in Odisha on withdrawal of tax sops

tate owned Indian oil Corp has threatened to reconsider in early 2016. The delay is now being cited by odisha to
Splans to invest Rs 52,000 crore on expansion of Paradip seek withdrawal of the incentives, sources said, adding
refinery in Odisha and setting up a petrochem project as that the state government feels the delay has pushed
the state government is withdrawing tax sops, according back the payback time of deferred taxes by few years.
to a report on moneycontrol.com.Indian oil Corporation
(IOC) plans to expand the 15 mln tpa Paradip refinery Oriental Containers expands
by 5 MT as well as set up a Polypropylene Plant and
a monoethylene plastic closure capacity in
glycol production Maharashtra
facility at the
site of the one- aps & closure manufacturer oriental Containers
year old refinery. CLtd, the wholly owned subsidiary of oricon
Following BJD-led Enterprises Ltd, has expanded the capacity of plastic
state government closures at its Murbad (Maharashtra) facility by 1.2
decision to roll billion. “The company has completed expansion
back tax sops because the project was delayed by 6 of its plastic closures manufacturing capacity at a
years, the company is now threatening to reconsider cost of Rs 35 crores at
future investment plans, sources privy to the development Murbad (Maharashtra)
said. The project is caught in a political cross-fire as Oil with a capacity of 1.2
Minister Dharmendra Pradhan, who hails from the odisha, billion closures per
and the state government are involved in a high pitched annum. With this total
political battle. Sources said IoC is telling the odisha installed capacity
government that it is reconsidering its investment plans of plastic closuresis
because of the withdrawal of 11-year deferral of VAT on increased to over 8
petroleum products sold in the state. Investment plans billion per annum,
also included projects to improve petrol and diesel quality highest in India,” said
to Euro-VI standards by 2020. If the investment does not Oricon Enterprises in a BSE filing. In addition to Murbad,
take place, IoC will have to look for a market for fuel oriental Containers – which manufactures a wide
outside India as no petrol and diesel of lower quality range of packaging products such as crowns, plastic
can be sold within the country. Also, the Rs 3,500 crore beverages & water closures, RoPP caps, aluminium
polypropylene plant is already under construction with collapsible tubes, twist off caps and metal printing
September 2017 as the target date for commissioning. It – has a production facility in Goa. In April 2015,
remains to be seen if IoC can stop the project midway. oricon Enterprises had acquired 70 per cent stake in
In the December 29, 2016 notice, odisha government has oriental Containers Ltd (oCL) from its joint venture
asked why the fiscal incentives like 11-year deferment of partners oC Holding Ltd, Mauritius, for Rs 105 crore,
sales tax on petroleum products sold in the state should making oCL its wholly-owned subsidiary. oCL has a
not be withdrawn considering that the Rs 34,555 crore technical collaboration with Silgan Holdings Inc. USA,
refinery was delayed by over six years. Sources said for manufacturing specialty caps (wide mouth caps),
the state government had in February 2004 signed an which are used for packaging of jams, pickles, gherkins
agreement with IOC to give fiscal incentives for setting up etc. The company supplies its products to various
a 9 million tonnes a year oil refinery at Paradip by 2009- industries like beverages and water, FMCG, breweries
10. However, the project was delayed and started only and distilleries.

41 March 2017 | Plastics News