Memorandum of Understanding

Between

Chhattisgarh State Industrial Development Corporation Limited  (CSIDC)
AND
Jindal Organisation

For

Steel and Allied Projects in the State of Chhattisgarh

New Delhi, Dated 21st May 2001

BETWEEN, the Chhattisgarh State Industrial Development Corporation (CSIDC) which is the investment promotion agency of the Government of Chhattisgarh and Jindal Organisation (Comprising of Jindal Steel & Power Limited, Jindal Power Limited and other Companies, which may be incorporated to implement these Projects) for proposed investment of Rs. 1900 Crores, in district Raigarh and at other locations in the State of Chhattisgarh.

This Memorandum of understanding (MOU) is made on this 21st day May, 2001, at New Delhi, between CSIDC (hereinafter referred to as the "Corporation" which expression shall, unless repugnant to the context or the meaning thereof include its successors and assigns) of the FIRST PART.

Jindal Organisation (hereinafter referred to as "Jindal" which expression shall unless repugnant to the context or meaning thereof, includes its successors, executors, administrators, representatives and assigns) of the OTHER PART.

AND WHEREAS JINDAL is desirous of setting up the following manufacturing facilities in the State of Chhattisgarh with Proposed Investment of Rs. 1900 Crores.

Sr.No. Project Capacity Investment

(Rs. in crores)

1. Rail & Universal Beam Mill 750,000 tons 450

2. Aluminium plant 50,000 tons 400

3. Captive Power Plant 110 MW 400

4. Steel Melting Shop II 750,000 tons 150

5. Ferro Chrome plant 60,000 tons 50

6. DRI Plant 450,000 tons 250

7. Mini Blast Furnace (351 CuM) 250,000 tons 100

8. Coal Washery 2.5 Million Tons 50

1. Development of addtional coal 50

mines

Total 1900

WHEREAS the Corporation acting on behalf of the Government of Chhattisgarh agrees to provide all help, prevailing incentives and facilitate clearances necessary for setting up the aforesaid Projects in the State of Chhattisgarh including facilitating the acquisition of private land consistent with the various Constitutional and Statutory provisions relating to such transfer of land as applicable to the area of the projects; expedite allotment of Government land required for setting of these projects and permission for optimal drawl of water required for the project from viable sources of water, required for the project, from viable sources of water, as well as facilitate recommendation of the State Government for grant of additional Mining Leases for the project's requirements.

NOW THEREFORE, in consideration of the foregoing and all other related factors, the Corporation and JINDAL have agreed to do and hereby execute this MOU in order to enable such a large private sector investment in the State of Chhattisgarh and for the aforesaid the Parties hereto have agreed upon the terms, assurances, obligations and commitments as set out herein below :-

1. It is agreed by the Parties hereto that JINDAL will setup the aforesaid projects at split locations in District Raigarh and at other locations in the State of Chhattisgarh, the cumulative investment shall be clubbed together and counted for the purpose of deciding the applicability of the incentive scheme, wherein the Corporation and the State Government agencies will extend fullest cooperation for successful implementation of these projects.

2. The Corporation will facilitate allotment of approx. 600 Acres of land by the State Govt. in dist. Raigarh as per rules, as required for implementation of these Projects.

3. The Corporation will facilitate Government's permission for optimal drawl of water from viable sources for operation of the aforesaid projects as per prevailing rates.

4. The Corporation will facilitate State Government's recommendation to the Govt. of India for allotment of suitable additional coal blocks.

5. The Corporation will facilitate grant of Bauxite mining lease by the appropriate Government.

6. The State of Chhattisgarh agrees the JINDAL will be given the tax benefits/incentives etc. which the Govt. of M.P. had already granted for Rail & Universal Beam Mill, Aluminium Plant, Captive Power Plant of 110 MW capacity and Sponge Iron Plant of 1.50 lac ton capacity, vide Notification No. A-3-9-2000-ST-V (40) dt. 24.4.2000, No. A-3-9-2000-ST-V (41) dt. 24.4.2000 and No. A-3-9-2000-ST-V (42) dt. 24.4.2000 and exemption in regard to Electricity Duty as per Notification No. 5328-F-13-55-XIII-2000. The Corporation agrees to facilitate expeditious grant to JINDAL of the tax benefits/incentives as per the aforesaid notifications for the balance projects, that is Steel Melting Shop II (750,000 MT) Ferro Chrome Plant (60,000 MT), DRI Plant (450,000 MT), Mini Blast Furnace (250,000 MT), Coal Washery (2.5 Million Tons) and additional coal mines. Any new or improved incentives which may be announced by the State of Chhattisgarh after signing of this MOU will also be a additionally extended to JINDAL at its option.

For witness whereof the parties hereto have set their hands to this MOU on this day of 21st May, 2001.

SIGNED AND DECLARED BY :

1. For CSIDC

(A Govt. of Chhattisgarh Undertaking)

(NARAYAN SINGH)

MANAGING DIRECTOR and

Secretary (C&I) , Govt. of Chhattisgarh

2. For Jindal Organisation

(Naveen Jindal)

Executive Vice Chairman &

Managing Director of Jindal Steel & Power Ltd.

WITNESS:

1. ANAND GOEL

S/O LATE C.R.GOEL

R/O A-8, ANTRIKSH APARTMENTS

SECTOR XIV EXTENSION, ROHINI, DELHI-85