* Judge allows Sterlite to restart smelter in a week
* Sterlite aims to begin production in about one week -
* Smelter restart to improve supply in India and Asia
By Krishna N Das
NEW DELHI, May 31 India's largest copper smelter
is likely to restart within a week, after a court on Friday gave
a conditional go-ahead, ending a two-month-long shutdown that
has squeezed domestic supply and boosted imports.
The smelter run by Sterlite Industries, a unit of
London-listed Vedanta, can resume operations overseen by
a court-appointed panel, Justice Swatanter Kumar of a fast-track
court, the National Green Tribunal, said.
"A balance has to be struck between environmental interests
and sustainable economic development," the judge said, adding
that the panel would determine if the smelter required
additional anti-pollution equipment.
The court will issue a final order after July 10, he added,
to follow Friday's interim order.
Sterlite's smelter is expected to resume production in about
a week, a company statement said. Earlier, the head of its
copper business P. Ramnath had suggested a restart in two weeks,
with supply to customers commencing in another week.
The smelter, which uses imported concentrates, produces
30,000 tonnes of refined copper a month, or more than half of
India's total production. Nearly half its output goes to China.
Its closure had made available to the market an extra 3,000
tonnes of copper concentrates each day.
"If the closure had been prolonged for some more time it
would have led to a steep increase for premiums," said a
physical trader based in Singapore, who has Indian clients.
"Already we had started getting copper cathode enquiries."
Most of India's exports of copper go to China, the world's
biggest consumer of the metal, which used around 9 million
tonnes last year, well in excess of India's annual consumption
of around 600,000 tonnes.
"The restart will ease the tight supply situation across
Asia, but particularly in India, where the domestic market has
been suffering because of a shortage in cathode," said another
metals trader based in Singapore.
The shutdown of the Sterlite smelter helped drive up copper
premiums, which rose in Shanghai to a high of $140 a tonne over
cash London Metal Exchange copper, the trader added.
A long-arranged shutdown of Hindalco Industries Ltd's
Birla smelter on May 7 also cut tonnage to the market.
That smelter, which produces around 30,000 tonnes a month, will
reopen early in June, the company has said.
India's cable makers faced a severe shortage of copper and
potential manufacturing delays after the closure of the
country's two biggest copper smelters.
Sterlite, whose parent Vedanta is controlled by billionaire
Anil Agarwal, has been waiting for government clearances to
double the capacity of its smelter to 800,000 tonnes a year.
Its smelter, in the coastal town of Tuticorin near the
southern tip of India, was shut on March 30 after residents
complained of emissions that led to breathing problems.
Environmental issues and other concerns, including land
acquisition, have enmeshed several global companies' plans for
big-ticket investments in India, ranging from South Korea's
POSCO to units of Vedanta.
Sterlite's smelter has long been the target of protesters
and politicians who call it a risk to local fisheries.
Several cases have been filed against the company since the
plant started in 1996. In a different case, India's top court
last month fined Sterlite about $18 million for breaking
environmental laws at the smelter.