Reliance Industries has decided to set up a polyethylene terephthalate plant at Hazira with a capital cost of around Rs 300 crore (Rs 3 billion). DuPont will provide the technological knowhow for this Greenfield project.

The plant will have a capacity of 130,000 tonne. RIL already has a PET plant at Hazira with a capacity of 80,000 tonne.

"We have surplus purified terephthalic acid and have, therefore, decided to set up a new PET plant as a step towards forward integration," a Reliance official said.

The construction for this plant is likely to start by June-July. Company executives said the plant is expected to be operational by end of 2004.

The PET capacity in India is expected to significantly increase in the next few years. Indian Oil is also setting up a plant with a capacity of 530,000 tonne at Panipat.

"The demand scenario is looking up in India, where the per capita consumption is still low," an analyst tracking the sector said.

Meanwhile, Reliance is also looking at doubling the synthetic rubber manufacturing capacity of Indian Petrochemical Corporation Ltd at Baroda from 50,000 tonne per annum over the next two years.

The company will also step into the engineering plastics market. A pilot plant for manufacturing engineering plastics is likely to come up either at Hazira or at Jamnagar.

With all these expansion projects, Reliance hopes to expand its export business by at least 25 per cent during the current financial year.