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Suman Layak
Gomia, May 13: The $200-billion US-based Ensign Bickford group plans to use Initiating Explosives Systems India Ltd, its joint venture with the Rs 700-crore ICI India Ltd, as a manufacturing base for non-electric detonators for the Asian and South American markets.
As part of the plan, Initiating Explosives Systems, the joint venture of ICI India and The Ensign Bickford Company (EbCo), is indigenising production of its range of non-electric detonators. ICI holds a 70 per cent stake in the joint venture.
The joint venture is likely to invest around Rs 10 crore to restart a shock tube manufacturing line at its plant in Gomia, which is a vital component of a non-electric detonator. The tube, accounting for 75 per cent of the cost of a non-electric detonator, is now imported from The Ensign Bickford Company.
The joint venture reported a turnover of Rs 45 crore in 1997-98 and a 50 per cent growth in turnover is expected for 1998-99.
As part of a technology transfer agreement between Initiating ExplosivesSystems and EBCo, there are plans to transfer the technology for electronic detonators to the joint venture in the future. The technology for electronic detonators is at a nascent stage of development all over the world.
ICI executive director and chairman of Initiating Explosives Systems RL Jain said: "We will fund the investments from our internal generation. We have plenty of room for going in for borrowings for this project."
Some machinery will have to be imported from The Ensign Bickford Company to restart an existing line. The ICI management is also considering the option of going in for a major investment ranging from $1-3.5 million to start a new line for shock tube manufacturing.
In non-electric detonators the detonation is achieved by providing a small shock. The shock tube transmits a shock wave created by a plain detonation over a distance up to the non-electric detonator.
Ensign Bickford Industries chairman JE Lovejoy was in Gomia on Monday along with the group's president and chiefexecutive officer RH Harnett and The Ensign Bickford Company's director international RG Pallanck. Lovejoy inaugurated a plant that will manufacture the Handidet brand of non-electric detonators from EbCo's Exel range.
Harnett said: "We want to use our joint venture with ICI in India to help us get through to the Asian markets, especially in the Asean countries. We are also using it to fill in gaps in our product range as certain products produced by Initiating Explosives Systems are not manufactured by any of our other units."
Harnett cited the case of exports of plain detonators to South American countries by Initiating Explosives Systems. "We have a joint venture in Chile and markets in Mexico and we are ready to open up opportunities for Initiating Explosives Systems in these regions."
"We want to ensure that the plant in Gomia is up to the world standards. If quality can be maintained exports will be a big opportunity for the company. The joint venture has provided us with an entry into India,"Harnett added.
EbCo also has a joint venture in Australia which is also likely to be used to serve the entire Australasia region. "We have looked at other locations in Asia but have no plans of starting manufacturing facilities there," Harnett said.
ICI is talking to various foreign companies in the field like Orica of Australia and Sassol of South Africa for possible joint ventures or technology collaborations, said Jain.
ICI may sell excess land at Gomia
ICI India is planning to sell excess land at Gomia. ICI executive director RL Jain said: "The land was necessary as a safety zone when we were manufacturing nitroglycerine based explosives."
"However, now that we are out of it, we can dispose of the land too. The entire plant and housing estate of ICI in Gomia is situated over 2,000 acres of land," Jain said.
"This is ideal for building a resort. We might do that too. Some have even suggested agriculture as an option," Jain added in a lighter vein.
Regarding ICI House in Calcutta, Jainadded: "We are looking at various options and even considering leasing out all the floors, creating a cash flow and selling it."
Copyright © 1999 Indian Express Newspapers (Bombay) Ltd.
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