People & Money

Nigeria Attracts $14 Billion in Investment Commitments from Indian Entrepreneurs

As part of President Tinubu’s official visit to India, he met with a group of Indian investors on Wednesday, the second day of his visit. These businessmen announced their intentions to invest $14 billion into the Nigerian economy in different sectors. The promises to invest were a crucial part of the Nigeria-India Presidential Roundtable and Conference which took place in New Delhi, the capital of India. 

According to the press release by Ajuri Ngelale, the Presidential Spokesperson, investment pledges were made by Indorama Petrochemical Limited, Jindal Steel and Power Limited, SkipperSeil Limited, the Managing Arm of the Miltary-Industrial Complex of the Indian Government, and Bharti Entreprises.

Also Read: How Many Jobs Can Dangote Refinery Actually Create?

In this article, let us explore some of the dynamics behind some of these investors and the potential returns for the Nigerian economy. 

Indorama Petrochemical Limited

At the conference, Indorama Petrochemical representatives announced an $8 billion investment to expand their fertilizer and petrochemical facility in Eleme, Rivers State. 

In 2006, Indorama International acquired a 75% equity stake in Eleme Petrochemicals Company Limited for $225 million. In 2016, Indorama commissioned a 1.4 million metric tons per annum (MMtpa) urea fertilizer facility in Eleme which was known as Line I. In 2021, Line II was commissioned, thus expanding the capacity of Indorama Eleme to 2.8 million metric tons per annum. The cost of the expansion was placed at $1.1 billion by the African Development Bank (AfDB). 

Before establishing the 3 MMTPA Dangote Fertilizer, Indorama Eleme was the biggest fertilizer company in Nigeria. With the presence of over 6 million metric tons per annum of fertilizer, Nigeria has attained self-sufficiency in fertilizer production. However, the underutilization of the country’s agricultural potential creates room for increased fertilizer production capacity. 

A proposed $8 billion investment in the fertilizer industry has the potential to position Nigeria as a major player in the global fertilizer market. However, specific details regarding the nature of this additional investment have yet to be provided.

Jindal Steel and Power Limited 

During the conference, Jindal Steel and Power Limited, a prominent steel producer in India, committed to investing $3 billion in Nigeria. At the moment, the only investment into the steel sector in recent times in Nigeria has come in the form of a $600 million steel plant in Kaduna which began construction in December 2019. 

The $600 million steel plant, led by an Indian company called African Natural Resources and Mines, was originally scheduled for completion in 2020. However, the project’s progress has been hindered by insecurity in Kaduna State

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Jindal Steel and Power Limited has a total production capacity of about 9.6 million tonnes per annum of steel. The company owns a coal mining company in Australia (Wollongon Coal Limited) which produces about 700,000 tons of coking coal per year. The company also controls an underground coal mine, Kiepersol Colliery in South Africa which is an underground coal mine with a 22 million tons reserve. 

Given their significant expertise in coal mining and steel production, a $3 billion investment from Jindal Steel and Power Limited is poised to reinvigorate Nigeria’s steel or coal mining industries. Nigeria is blessed with an abundant supply of iron ore reserves and coal reserves which are critical components of steel manufacturing. An investment from Jindal could kickstart heavy manufacturing in Nigeria, as steel is a critical component in the production of cars, machinery, and various industrial applications. 

SkipperSeil Limited

At the meeting, Mr. Jitender Sachdeva, the Founder of SkipperSeil Limited, revealed that, with the personal support of President Bola Tinubu, he plans to invest $1.6 billion in building twenty 100MW power plants in Northern Nigeria. He noted that this ambitious project aims to add 2,000MW of new power capacity in the region within the next four years.

Skipper Seil Limited is a company specializing in the manufacturing and distribution of power transmission and distribution equipment, as well as engineering products and services. The company has a global presence in over 50 countries, including Nigeria. 

In Nigeria, the subsidiary of Skipper Seil Limited is Skipper Nigeria Limited. The company has a strong footprint in Nigeria, with the manufacture of power transformers, smart meters, distribution transformers, as well as transmission lines and substations. 

Bharti Entreprises 

Bharti Entreprises, the parent company of Bharti Airtel (Airtel Africa Plc) also expressed interest in investing an additional $700 million in Nigeria. Bharti Enterprises, a major Indian company, is involved in telecom, space communications, digital solutions, insurance, processed foods, real estate, and hospitality. 

Also Read: The Oil And Gas Industry Is Booming Despite Net-Zero Ambitions

No details have been provided regarding the specific sectors or projects in Nigeria that Bharti Enterprises plans to invest the additional $700 million in.

Final Thoughts 

With India ranking as one of Nigeria’s foremost global trading partners, the trend of Indian conglomerates investing in Nigeria is well-established. Renowned Indian companies such as Chellarams Plc, Tata, Dana Group, Artee Group (which operates SPAR and Park n Shop retail chains), and Dufil Prima have all made significant investments in various sectors of the Nigerian economy. These Indian conglomerates have contributed to Nigeria’s economic development and have played a pivotal role in strengthening the bilateral economic ties between the two nations.

David Olujinmi

David Olujinmi studies Engineering but his true passion is research and analysis. He writes about finance, particularly the capital market, investment banking, and asset management. More »

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