The Hindu Business Line : Govt in favour of merging Neelachal Ispat with RINL

Visakhapatnam, Jan. 3 The issue of finding captive iron ore mines to the Visakhapatnam Steel Plant seems to have been solved, with the assurance given by the Prime Minister, Dr Manmohan Singh.

Mr N. Janardhana Reddy, former Chief Minister of Andhra Pradesh and currently representing the Visakhapatnam Lok Sabha constituency, said at a late night press conference on Wednesday that he has represented the matter to the Prime Minister, who was in the city for inaugurating the Indian Science Congress.

Dr Singh reportedly told a delegation led by Mr Reddy earlier in the day that the UPA Government was in favour of merging Neelachal Ispat Nigam Ltd in Orissa with Rashtriya Ispat Nigam Ltd (holding company of Visakhapatnam Steel Plant) to solve the raw material problem.

BHEL-BHPV merger

According to Mr Reddy, the Prime Minister also assured on the merger of Bharat Heavy Plate and Vessels Ltd with Bharat Heavy Electricals Ltd to revive the former.

He has also promised to extend all help to revive Hindustan Shipyard Ltd here by bringing it under the control of the Ministry of Defence.

The Prime Minister’s proposal for merging Neelachal Ispat with RINL comes in the wake of repeated failed attempts by the latter to get captive iron ore mines from several mineral-rich states such as Orissa, Chhattisgarh and Jharkhand. Its applications have been rejected by them, which are seeking value-addition at the pithead.

RINL gets iron ore from National Mineral Development Corporation. The plant’s current capacity of 3 million tonnes is being doubled at a cost of Rs 8,600 crore with enough iron ore linkage. But lack of captive mines is proving to be a major handicap for the plant, as it is unable to cut down on the cost of production. The plant’s future expansion will also be hit without captive mines.

Earlier there was a proposal to merge RINL with Steel Authority of India Ltd to solve the raw material problem, but the proposal met with opposition from the AP Government and all the major political parties in the State. Ostensibly, it was dropped on the ground.

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