New Delhi: Vedanta Resources Plc will invest roughly $9 billion in India over the next few years to expand its hydrocarbons, metals and mining businesses and meet more of India’s requirements of these commodities locally, executive chairman Anil Agarwal said in an interview.

Vedanta’s plan to invest in the resources sector comes at a time when the commodities market is showing signs of a pick-up. Agarwal said these investments will create over a million jobs directly and indirectly.

The proposed investments are in sectors such as oil and gas, production of aluminium, zinc, copper, silver and steel and mining of bauxite and rock phosphate.

“We are planning to invest $2.5 billion in oil and gas to step up our production to half of India’s crude oil output (from 26% in 2016-17)," said Agarwal.

Vedanta produced 189,926 barrels of oil equivalent a day in 2016-17, according to information available from the company’s website.

Prime Minister Narendra Modi had in March 2015 set a target of lowering India’s import dependence in oil by 10 percentage points to 67% by 2022.

Agarwal said the other proposed investments in India include $1.5-2 billion in the aluminium sector, $2 billion in bauxite mining, $1.5 billion in zinc and $1.5 billion in iron ore mining and steel. Also, a part of Vedanta’s proposed $1.5 billion investments in copper will flow into India.

“Directly and indirectly, these investments will create over a million jobs. I am very passionate about our investments in India," Agarwal said.

Vedanta is also looking at investing Rs4,000 crore in Jharkhand to set up a 1 million tonne per annum plant producing pellets, pig iron and pipes that the group expects will create 5,000 jobs.

To make the proposed investments viable, Vedanta is seeking relief from a 10% extra profit share that the government expects from its block in Rajasthan—RJ-ON-90/1—on the extension of its contract in 2020.

The government had in May cleared a policy for extending the term of more than two dozen oil and gas production contracts signed prior to 1999, which also provides for a higher share of profits to the government from the blocks during the extension period.

Vedanta is also constrained by the quantitative cap on iron ore mining in Karnataka and Goa.

Experts said companies in the metals and mining sector have witnessed better margins and cash flow in the current year due to better prices in world markets.

“The Indian metals industry in general is expected to see strong growth in the near to medium term due to urbanization and the demand for infrastructure creation. The ongoing insolvency resolution proceedings in the steel industry are expected to result in stressed assets in this sector transitioning to stronger hands, with a sharper focus on efficiency," said Anjani Agarwal, partner, metals and mining, at EY.

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