The moves are part of GE's initiative to generate more of its earnings from outside the United States by tapping into fast-growing economies.
Building on a 10-year record of emerging markets investments totaling $1 billion, GE Energy Financial Services is lending INR 75 Crores ($17 million US) to Binani Cement Ltd. for construction of a 22.3-megawatt thermal power plant and associated common utilities in Sirohi, Rajasthan, in north India. This will enable Binani Cement, a subsidiary of Binani Industries Ltd., to meet its enhanced power requirement to expand cement production by April of this year from 2.25 million metric tons to 5.3 million tons annually. Binani Cement also plans to build a second 22.3-megawatt power plant. Binani Cement is proposing a public equity shares offer.
Indias cement consumption, the worlds second largest after China, is growing at 9 percent annually, because of a boom in housing and infrastructure construction.
Alex Urquhart, President and CEO of GE Energy Financial Services, sees the investment in Binani Cement as just the beginning of a broader, global investing strategy. India is a launching pad for our global growth, a platform to expand and serve customers in other key markets such as the Middle East and East Asia, he said.
Added Colleen Harkness, Managing Director and head of Global Growth at GE Energy Financial Services: For Binani, the power plant were helping finance will cut costs by nearly US$ 4 million annually and provide a highly reliable electricity source. For GE, this sets the stage for our growth in India through investments in power projects addressing Indias growing industrial power requirements, including in the cement and steel industries, as well as in renewable energy, electric transmission and water.
To penetrate the India market, GE Energy Financial Services began operations in New Delhi last fall, and will open an office there during the second quarter of this year, to be headed by Raghuveer Kurada, an energy investment professional.
In electric power alone, India has tremendous potential, with requirements of more than 100 gigawatts, which will require investments of around $200 billion US, including transmission and distribution.