SOURCE: India Globalization Capital, Inc.

India Globalization Capital, Inc.

June 03, 2009 08:35 ET

India Globalization Capital Secures $2.6 Million Iron Ore Contract

Establishes Presence in Chinese Iron Ore Market

BETHESDA, MD--(Marketwire - June 3, 2009) - India Globalization Capital, Inc. (NYSE Amex: IGC), a company competing in the rapidly growing materials and infrastructure industry in India, today announced it has secured a 2.6 million dollar contract to supply a Chinese company with iron ore. The order is for 40,000 metric tons (mT) of ore with a ferrous content of 62.5%.

"This order will be filled out of our shipping hub at the Krishnapatnam port in India. We expect demand for commodities to increase as China and India ramp up their infrastructure investment activities. Our strategy of establishing a brand and securing long-term delivery contracts is in place, and we are in the process of setting up another shipping hub on the west coast of India at Goa as part of this strategy. India Globalization Capital is well positioned to take advantage of the growth in the materials marketplace, and we expect our materials segment to be a meaningful addition to the company's operations," said Ram Mukunda, Chief Executive Officer of India Globalization Capital, Inc.

The importance of iron ore cannot be overstated. It is the most widely used of all metals, comprising 95% of the metal tonnage produced worldwide. Global use of finished steel products has increased markedly since 2005. The requirement for iron ore is particularly large in China where steel demand has risen by more than 13% in recent years. Worldwide, crude steel production climbed from 1,251 mT in 2006 to 1,344 mT in 2007, an increase of 7.5%, and has followed a similar trajectory in 2009, with China accounting for 46% of world iron ore imports.

Iron ore is rock and minerals from which metallic iron can be extracted. The primary form used in industry today is hematite, and is often the principal raw material used to make pig iron, a material critical to the production of industrial steel.

About India Globalization Capital:

India Globalization Capital is a construction and materials company operating in India, which builds roads, bridges and highways, and provides materials to the infrastructure industry in India and China.

The company has offices in Maryland, Mauritius, Nagpur, Cochin, Delhi and Bangalore. Copies of the Form S-3 and India Globalization Capital's other filings with the SEC containing information about India Globalization Capital, our Indian operations and other relevant documents, are available at no charge on the SEC's website (http://www.sec.gov).

For more information about India Globalization Capital, visit the company's web site at: www.indiaglobalcap.com.

Forward-Looking Statements:

This press release may contain forward-looking statements. These statements reflect management's current views and are subject to risks and uncertainties that could cause actual results to differ materially from those projected, expressed or implied in these statements. Factors, which could cause actual results to differ, relate to: (i) the ability of the parties to successfully execute on the contracts and business plan, (ii) our ability to raise additional capital and the structure of such capital including the exercise of warrants, and (iii) changes in the exchange rate between the U.S. dollar and the Indian Rupee. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. Other factors and risks that could cause or contribute to actual results differing materially from such forward-looking statements have been discussed in greater detail in the company's definitive proxy statement and supplement filed with the SEC and incorporated by reference into the Form S-3.

Contact Information