Bolivia demands penalty from Jindal Steel

Bolivia demands penalty from Jindal Steel

UNITED NATIONS, May 10: Bolivia has said that the multi-billion dollar contract it signed with India’s Jindal Steel to develop an iron ore mine has not been rescinded, but the steel company would have to pay a penalty for not fulfilling the terms of the agreement. “The contract will continue but there is a penalty there because the partners need to respect their contract in Bolivia and the Bolivian people,” he told reporters at the UN headquarters where he was speaking on a different issue of the recently concluded climate change conference in Cochabamba. In 2007, Jindal signed a joint venture agreement with the government to develop the El Mutun mine that may produce two million tonnes of iron ore in its first year. In April, reports emerged that the parties were having disagreements over the contract. Media reports noted that Jindal wanted to invest USD 2.1 billion in El Mutun but wanted to produce 40 per cent less steel and around 20 per cent less iron a year than was agreed in the original contract. (PTI)