Union Minister of State for Steel, Faggan Singh Kulaste, has stated that the Centre has decided to put the Vizag Steel Plant (VSP) disinvestment plan on hold and aims to improve its performance instead.
He has also mentioned a scheduled meeting with the steel plant workers on Thursday (April 13) evening.
The suspension of the disinvestment plan for VSP is being seen as a significant victory for Telangana Chief Minister K Chandrashekhar Rao and his party Bharat Rashtra Samithi (BRS), who opposed the plant’s privatisation.
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Recently, Rashtriya Ispat Nigam Ltd (RINL), the corporate entity of VSP, had sought Expressions of Interest (EoIs) from private companies and steel manufacturers, seeking working capital and raw materials and the willingness to purchase its products.
The Telangana government-controlled Singareni Collieries Company Limited (SCCL) was considering participating in the EoI.
VSP has been facing a shortage of working capital, which has affected the functioning of the plant, leading to the closure of one of its three blast furnaces in January 2022.
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VSP is the only shore-based integrated steel plant in India, located near two major ports within a 25-km radius. It has expanded its capacity from 3 million tonnes to 7.3 million tonnes, following the National Steel Policy, and is the largest single public sector unit in the steel sector.
However, due to financial issues, VSP has not been able to achieve its stated capacity.
(With agency inputs)