Harare — JINDAL Steel and Power, India's second largest steel company has moved in to start mining operations in Zimbabwe.

An official said in an interview yesterday that the company, which is planning to re-bid for the Zimbabwe Iron and Steel Company 70 percent stake was mainly interested in coal mining.

The Mumbai-based industrial firm has already registered its local mining subsidiary, Jindal Mining Company Zimbabwe. "It is true that we have registered a company in Zimbabwe. Apart from bidding for Zisco, we are also interested in mining particularly coal extraction," said the official. Jindal requires coal and coke for its steel operations.

The investment will be regarded as a huge vote of confidence in a country that is on the recovery course following a decade of economic downturn characterised. Dollarisation has also made Zimbabwe more attractive for investment as it does not pose exchange risk problems. Last month, US fast food retailer McDonald's announced it was planning to enter the Zimbabwean market.

The company said it was weighing a number of options for the Zimbabwean market. McDonald's is one of the largest fast food retailers in the world, and first mooted plans to open restaurants in the country 10 years ago. The company was, however, forced to suspend operations when the country started facing economic challenges in 2000.

This week, Jindal said it is considering making a fresh bid for a 70 percent stake in Zisco, one of the largest steel makers in the region. The move came after Government re-invited bids for the steel plant, which has capacity of producing 1 million tonnes of steel per year. "We may re-bid for Zisco, but a final decision will be taken before the September 24 deadline," Jindal Steel and Power (JSPL) Whole-Time Director Sushil Maroo said on Tuesday.

In May, the Government had rejected bids for Zisco by Jindal Steel and ArcelorMittal of South Africa, citing the "big size" of the companies.