New Delhi, January 24, 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 Mr. 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
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 Mr. Dimitris Tsitsiragos, Director
of IFC’s Global Manufacturing and Services Department.
Mr. Ashok Punj, PSL’s Managing Director, noted “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.