Stating that the Central government cannot bear repeated losses by Visakhapatnam Steel Plant, Union Minister of State for Heavy Industries B Srinivas Varma, said that the Centre is evaluating a potential merger of Rashtriya Ispat Nigam Limited (RINL), which operates the Visakhapatnam Steel Plant, with the Steel Authority of India Limited (SAIL) to resolve the financial crisis plaguing the steel giant.
However, technical hurdles related to SAIL’s status as a limited company are delaying the proposal. Speaking to the media, Varma highlighted, “We are discussing a merger with SAIL to save the Visakhapatnam Steel Plant from its ongoing losses, but there are technical issues as SAIL is a limited company. We are exploring ways to overcome these challenges.” The minister emphasized that other options are also being considered, including selling land to the National Mineral Development Corporation (NMDC) to set up a pellet plant, which could generate much-needed revenue for the steel plant.
Additionally, the government is looking into securing loans from the State Bank of India and other public sector banks to manage the current financial burden. Varma noted that the steel plant’s employees are pushing for a merger with SAIL as they feel increasingly insecure after several employees were transferred to other institutions on deputation. “The employees are in favor of the merger because they see it as a way to secure their jobs,” he added.
Addressing the issue of captive mines, Varma clarified that under new government regulations, RINL would have to participate in auctions to acquire these mines. He acknowledged the pressure he faces as a minister from Andhra Pradesh, stating, “There is a responsibility on me to ensure a viable solution is found.”