Washington, January 23, 2006
— The International Finance Corporation, the private sector arm of the World Bank Group, has agreed to provide $20 million in financial support to India’s steel pipe maker PSL Limited.
The financing will support the expansion of PSL’s production capacity to meet a rapid increase in domestic and international demand for large-diameter steel piping for use in oil, gas, and water applications. In eastern India, the PSL expansion will help satisfy demand for piping due to recent gas finds in the Krishna Godarvi
Basin. The project will also help the company to improve its cost competitiveness, productivity, product quality, and environmental performance.
“IFC’s investment in PSL is helping a local player enhance its regional presence. This is in line with IFC’s mission to promote sustainable private sector investment in emerging markets,” said Iyad Malas, IFC’s Director for South Asia. “It will also allow PSL to play a bigger role in providing the large diameter piping that is a critical part of India’s infrastructure.”
IFC’s financing comprises an equity investment of $5 million equivalent and a loan of $15 million, which will support the expansion of PSL’s installed capacity for large-diameter steel pipe manufacturing from 675,000 tons to 1,425,000 tons per year.
PSL Limited is India’s largest manufacturer of high-grade, large-diameter helical submerged arc welded pipes for oil, gas, and water transmission as well as for structural and piling requirements in onshore and offshore applications. PSL also offers comprehensive pipe-coating services.
“PSL is pursuing an ambitious expansion strategy to meet the high demand for its products in India and the region, and we are pleased to support the company in meeting its goals,” said Dimitris Tsitsiragos, Director of IFC’s Global Manufacturing and Services Department.
Mr. Ashok Punj, PSL’s Managing Director, noted that “IFC is playing an important part in our expansion plans and is helping us strengthen our financial position. IFC is also helping us upgrade our corporate practices in environmental and occupational health and safety management.”
The International Finance Corporation is the private sector arm of the World Bank Group and is headquartered in Washington, D.C. IFC coordinates its activities with the other institutions of the World Bank Group but is legally and financially independent. Its 178 member countries provide its share capital and collectively determine its policies.
The mission of IFC is to promote sustainable private sector investment in developing and transition countries, helping to reduce poverty and improve people’s lives. IFC finances private sector investments in the developing world, mobilizes capital in the international financial markets, helps clients improve social and environmental sustainability, and provides technical assistance and advice to governments and businesses. From its founding in 1956 through FY05, IFC has committed more than $49 billion of its own funds and arranged $24 billion in syndications for 3,319 companies in 140 developing countries. IFC’s worldwide committed portfolio as of FY05 was $19.3 billion for its own account and $5.3 billion held for participants in loan syndications. For more information, visit
www.ifc.org
.
