The chief executive of the Conares steel business is planning to build a steel mill in the UAE after gaining formal approval from the Dubai government to launch a business on the mainland.
Bharat Bhatia intends to build a plant capable of manufacturing 100,000 tonnes of steel per year after securing a licence from Dubai FDI, an arm of the Department of Economic Development, for a 100 per cent-owned onshore business. He and his family have run Conares, a steel production and trading business, from the Jebel Ali Free Zone since 1988.
“It feels great to hold [a] Dubai FDI licence to own an industrial manufacturing unit in the UAE’s mainland. After residing in the UAE for more than 30 years, this adds massive value to my business and we hope to contribute more to economic growth,” Mr Bhatia said in a statement.
Conares initially built its business in the UAE through trading and re-exporting steel, supplying pipes and rebar to the UAE’s construction sector. In recent years, it has added local manufacturing, building a rebar factory and pipe mills in Jebel Ali. The company has an annual turnover of about Dh1 billion and a capacity to manufacture one million metric tonnes per year.
The Dubai government passed a Foreign Direct Investment law allowing for 100 per cent foreign ownership of onshore UAE companies in certain categories in 2018. In March this year, an update set out the 122 different sectors and economic activities in which 100 per cent ownership is permitted.
Conares is planning an investment of about Dh25 million to Dh50m in the new mill, Mr Bhatia told The National.
It will help to serve projects in the UAE and the wider Arab world, promoting a “Made in UAE” product range, Mr Bhatia said in the statement.
The new FDI Iaw will also encourage more investors to set up businesses in the industrial sector, which is the “backbone” of any global economy, he added.
“The business of trading and re-exports is slowly fading out. Value addition is the only way forward,” Mr Bhatia said.
Conares currently supplies steel to Dubai’s Expo 2020 and the Etihad Rail project.
“We foresee a good demand for our products for ongoing and upcoming projects in the UAE,” Mr Bhatia said.
Updated: August 31, 2020 05:45 PM