In what could be good news for the workers of Visakhapatnam Steel Plant, also known as Rashtriya Ispat Nigam Limited (RINL), the Centre is reportedly dropping the proposal to privatise the plant.
Instead, the government is actively considering merging RINL with another state-owned steel company, the Steel Authority of India Limited (SAIL).
Sources indicate that the merger proposal is one of the options being explored to ensure the survival of the RINL plant and address its financial and operational challenges.
To provide capital for continuing operations at the Visakhapatnam steel plant, the Centre is working on various plans, including selling land parcels to NMDC and raising bank loans.
The Secretary of the Department of Financial Services (DFS), the Secretary of Steel, and top officials from the public sector lender, SBI, recently held a meeting regarding the RINL issue. SBI has significant loan exposure to RINL.
"The government aims to provide a permanent solution to the issue. One option being discussed is the merger of RINL with SAIL," sources revealed.
Rashtriya Ispat Nigam Ltd (RINL), under the Ministry of Steel, owns and operates a 7.5-million-tonne steel plant at Visakhapatnam, Andhra Pradesh. It holds the distinction of being India's first shore-based integrated steel plant.
SAIL, also under the Ministry of Steel, is being considered for the merger.
Additionally, capital arrangements for ongoing operations are being discussed, along with talks with lenders for financial assistance and monetising assets by selling a 1,500-2,000-acre land parcel to NMDC for a pellet plant.
In January 2021, the Cabinet Committee on Economic Affairs (CCEA) gave 'in-principle' approval for 100% disinvestment of the government’s stake in RINL, along with its subsidiaries and joint ventures, through strategic disinvestment via privatisation.
