One of the biggest pipeline-building hubs in the world is emerging at Anjar, Kutch. Astonishingly, it has come up virtually unknown to the public. BK Goenka, CEO of Welspun Gujarat, says that Indian companies now account for almost a quarter of the world’s pipeline sales. The current global boom in oil and gas has sent pipeline demand skyrocketing. Water and sewerage pipe demand is rising too. All Indian pipe companies have become global players. And all have flocked to Anjar for expansion. The hub’s five big companies are Welspun Gujarat, Jindal Saw, PSL, Man Industries and Ratnamani Metals and Tubes. Their current capacity is around 1 m.t/year, and is being doubled. Optimists say it will be quadrupled. Welspun Gujarat is currently the biggest at Anjar. It is a global leader in the high pressure oil and gas segment, and has supplied extra-thick pipe for the deepest projects in the world in the Gulf of Mexico. It has diversified into coated pipes that check corrosion and extend life. Its capacity of half a million tones is being doubled. It is moving from low-tech spirally welded pipes to high-tech longitudinally welded pipes (and so are other pipe producers). High quality pipe requires steel plate of special specifications. Sometimes, the plate quality has to be tailored to pipeline specifications. Unfortunately India has traditionally not made such steel plate, most of which is imported currently from Europe. To overcome this disadvantage, Welspun has decided on backward integration. It is putting up a captive steel plant and plate mill of one million tonnes capacity, to be doubled later. Jindal Saw also aims for full integration. It has built a blast furnace producing iron for its ductile pipe plant of two lakh tonnes capacity, and plans to expand to five lakh tonnes of all pipe varieties at Anjar. It too plans a plate mill. Jindal Saw owns pipe-making facilities at several other locations in India, as well as two in the USA. PSL is by most measures the biggest pipe producer in India, with plants in seven locations. It is the traditional leader in water pipelines, but has now moved aggressively into the oil and gas business. Man Industries is a medium-sized but fast-rising star with a capacity of 0.3 million tones at Anjar. It has a speciality niche in aluminium extrusions. And it is the first Indian company to get listed on the Dubai stock market, an indicator of its global intentions. The fifth player at Anjar is Ratnamani Metals, which specializes in ERW pipes. Why have pipeline companies flocked to Anjar? Partly to avail of the tax breaks announced for Kutch after the earthquake in 2001. More important, Kutch has good logistics. It has the deepest waters in India, and can accommodate the biggest vessels. It is the only coastal location that is virtually monsoon-free, facilitating loading the year round. Anjar is close not only to Kandla, a major port with a modest 9.5 m. draft, but also to the fast-growing private port of Mundra, which plans to have a17 m. draft. Deep, monsoon-free ports are major advantages for pipe fabricators that import steel plate, export pipe, and later seek to import iron ore and coking coal for blast furnaces. Mundra and Kandla have just been connected by broad gauge rail to the main Delhi-Mumbai line, providing access to internal markets. l Pipes are bulky: Welspun Gujarat plans to produce pipes up to 18 metres (60 feet) long. The pipe industry requires lots of land: a pipe welding plant can be almost half a kilometer long. Semi-arid Kutch is sparsely populated, and can provide large parcels of land with minimum displacement of people. Pipe companies can buy hundreds of acres directly from peasants, avoiding the agitations that have arisen from government acquisition in Orissa. Finally, Kutch is the closest point in India to the Persian Gulf , a major market for its products. Why should Anjar be able to beat rival pipeline hubs such as Jebel Ali in Dubai or Houston and other US locations near the Gulf of Mexico? Because, says Welspun Gujarat, land and labour are much cheaper in India, and Indian skills are world class. Indian companies today can raise money abroad on almost as good terms as multinationals like Mannesmann (the current world leader). Deep, efficient ports in Kutch are able to lower shipping costs. For some kinds of pipe coating, US environmental standards are very stiff, giving Indians rivals an edge. India is a cheap steel producer, and once the big Anjar pipe companies build their own steel plants and plate mills, they believe they can beat their global rivals. Will Anjar succeed in becoming the number one pipeline hub in the world? It’s too early to say. But it seems well placed to rank among the top three hubs. That’s a major achievement.