The government Wednesday granted a 20-year controlling interest in the Zimbabwe Iron and Steel Company, or ZISCO, to Global Infrastructures, an affiliate of the Indian steel giant Mittal, which has already established itself in the South African market.
Under the arrangement the Indian partner will turn around and operate the troubled firm, injecting $400 million in new capital into the debt-burdened state company. Under the so-called rehabilitate-operate-transfer agreement, Harare could reassume control of ZISCO after two decades.
Global Infrastructures is a subsidiary of Global Steel Holdings, an Indian conglomerate with a steelmaking capacity of 14 million metric tons not only in its home country but in Europe, Africa and the Asia-Pacific region. Global Steel holds a controlling stake in the Mittal Steel Company of Lakshmi Mittal, its founder, CEO and chairman.
Mittal Steel controls Mittal Steel South Africa, formerly called Ispat Iscor.
Reporter Chinedu Offor of VOA’s Studio 7 for Zimbabwe asked Global Infrastructures Managing Director Lalit Sehgal about his company’s ambitions for ZISCO.
Economist John Robertson commented on why it makes sense for the country to turn ZISCO, deeply indebted and on the brink of collapse, over to the Indian group.