India's Jindal warns it may scrap $2 billion Bolivia project

[Zorro]

India's Jindal Steel & Power (JSPL) said on Saturday it was making plans to scrap a $2.1 billion steel project in Bolivia, saying the Bolivian government had not met contract terms that include supply of natural gas for the project.

The steel and power producer said it had served its "intent to terminate the contract" and the Bolivian government had 30 days to resolve the issues.

"In case government of Bolivia comes out clean and informs as to how much gas it can actually supply and agrees to reconfigure plant capacity and investment and amend the contract JSPL can consider staying back," a Jindal Steel statement said.

Jindal Steel had signed a pact with the Bolivian government in 2007 to invest $2.1 billion in iron ore mining and steelmaking. The company said it was the single largest foreign investment in the country.

More at: http://news.yahoo.com/indias-jindal-warns-may-scrap-2-billion-bolivia-113943575--business.html

30 days is a pretty short time to reach agreements on amending contracts. I wonder if Jindal is getting nervous about Evo's recent public statements about nationalizing industries.

[COLGATE4]

1. I doubt that the folks that run Jindal are fools

They can read the tea leaves pretty well - why expose your investment to possible nationalization if you don't have to?

[Zorro]

2. No doubt Bolivia can do well without such foreign investment

Their internal industrial base surely has the requisite technical skills and expertise to build such a plant.

[mitchtv]

3. you are kidding

Bolivia has no industrial base, whatsoever. The capital is full of half finished projects that ran out of money. Cocaine, some mining, and a little agriculture, makes for one of the poorest nations on earth. I wish them luck,everytime a socialist gets in they are overthrown. Almost as many presidents as years of independence (some years ago, marginal stability has probably changed that a bit)

[COLGATE4]

4. Yep. It's worked out so well for them

in the past...