Vedanta Limited Chairman Anil Agarwal has written a letter to stakeholders supporting the proposed demerger of the company. He said that this step will help in better exploitation of India's natural resources and accelerate economic growth.

Huge potential in India
Anil Agarwal wrote in the letter that the consumption of natural resources in India is increasing with double-digit growth. Less than 20% of the country's natural resources have been used so far.

India is soon going to become the third largest economy in the world. Its demand for natural resources is going to increase rapidly. Compared to Australia and Chile, India's mining sector contributes relatively less to GDP.
 

• India - 3%
• Australia - 15%
• Chile - 13.5%

Purpose of Vedanta Demerger
Vedanta has proposed the creation of four new natural resources focused companies. After the demerger, these new companies will work with independent and strong management, separate capital structure and solid assets.

This decision will also help in the creation of new jobs and downstream industries. Anil Agarwal said that Vedanta's demerger plan is an important step towards adopting a "pure-play business model". The company will have the potential to become a $100 billion company. After the demerger, every Vedanta shareholder will get 1 new share in each demerged company.