Reliance plans huge investment in ICE sector

Reliance plans huge investment in ICE sector
ENS ECONOMIC BUREAU

MUMBAI, JUNE 30: Reliance Industries Ltd, India's largest private sector firm, plans to make major a foray into building infrastructure for the information technology age. The group will invest more than what it put in the Jamnagar refinery project. Going by this estimate, the group will invest over Rs 15,000 crore in the ICE (infotech, communication and entertainment) sector.

"Reliance plans to roll out a world class, all optic, Internet protocol based broadband network covering the top 115 cities in India," Reliance group chairman Dhirubhai Ambani told shareholders at the company's annual general meeting.

The company will be the lead investor in "infocom" initiatives, he said, but did not give details. Reliance, which is India's leading petrochemicals firm, it also makes textiles and has interests in oil exploration and refining. "We will come out with an appropriate plan and a proper structure very shortly," he said.

The network will provide capability to participate in local, long distance and international communications markets, he said. It will also provide integrated broadband services with voice, image and data offerings over its network, it said.

"Reliance expects to complete these investments in the next 24 months," he said. He said discussions with global firms for alliances "across the entire digital value chain" were in an advanced stage.

Ambani said the company expects to cut costs and improve profitability by selling products over the Internet. "Reliance is actively considering participation in a number of opportunities, involving the major global Internet based chemicals marketplaces and developing similar initiatives in India," he said.

The company will expand its cellular base to cover 90 cities and double the subscriber base in the next one year. It has already commenced fixed line telecom services in Gujarat in March 2000, he said.

The company is "faring well" in the current year and it will release its results for the first quarter of 2000/01 (April-March) on July 20, he said.Reliance shares were up Rs 1.85 at Rs 342.50 in a volume of 3.3 million shares at the Bombay exchange.

Ambani said there was no plan to merge Reliance and group firm Reliance Petroleum Ltd which announced the completion of its 27-million tonne (540,000 barrels per day) grassroots refinery in January, though production began in mid-1999. Reliance Petroleum is likely to achieve a turnover of Rs 25,000 crore in the current year ending March 31, 2001, he said.

A revised development plan for enhancing the production from Panna and Mukti oilfields is at an advanced stage of consideration. Estimates for recoverable reserves from these oilfields have recently been revised upwards by 28 per cent, he said.

Reliance is planning to participate in the bidding for oil blocks under the new oil exploration policy in a big way. It is also looking at overseas opportunities to expand the presence in the oil sector, Ambani said. RIL has recently been awarded 14 offshore blocks covering an acreage of over 100,000 sq km off the west and east coast of India.

On the power sector, Ambani said, ``our objective is to achieve capacity of 10,000 MW over the next 5-10 years. ``We have substantial experience in power generation, as we have implemented captive power plants at all our manufacturing locations,'' he said, adding, ``We are pursuing several other attractive opportunities in the power business, across the areas of generation, transmission and distribution. This business has a natural integration with our petrochemical business.''