With the Union Cabinet approving the CCEA decision to shut the Hospet-based Tungabhadra Steel Products Ltd (TSPL), the curtains will finally come down on one of the finest and earliest examples of ‘make in India’.

Like several other PSUs, Tungabhadra Steel saw its glory days initially but later incurred huge losses.

TSPL was a successor to the Workshops & Machinery Division of the Tungabhadra Dam project, which was set up to manufacture gates and hoists required for spillways, sluices and canal gates. These equipment used to be imported earlier, involving outgo of huge foreign exchange.

In 1960, it was converted into a PSU with equal participation from the governments of Mysore (now Karnataka) and Andhra Pradesh. Later, it became a central PSU with the Government of India taking a 79 per cent stake in the joint venture, bringing the company under the administrative control of the Union Ministry of Heavy Industry.

Before it stopped production, the company had started supplying steel structures to power and irrigation projects, with BHEL and SAIL among its customers, and for construction of the Linganmakki Dam and the Sardar Sarovar project.

Missed opportunities Much before the company went defunct, state-owned KIOCL, an exporter of iron ore pellets, is learnt to have thrown its hat into the ring to take over the company. The acquisition would have helped KIOCL immensely if it had obtained the mining lease for the Ramanadurga iron ore deposit. TSPL also had a mini hydel plant that generated 5.5 million units of power per year.

Nothing was heard since then and over a period of time, about 350 workers were laid off with a hefty VRS. The project has about 85 acres of land right in the middle of Hospet, once the hotbed for mining activity.

The Cabinet has now approved the sale of the land to the Karnataka Government for use by the Karnataka State Housing Board. The land is being sold to the State government at the ₹66 lakh per acre rate offered by it. The proposal to transfer metallurgical and material handling plants to Karnataka along with 20,000 square metres of land, has also been cleared.

A former union member said that TSPL went belly up because of mismanagement. It also did not receive funding at the right time from the Centre, which was not keen on pumping money into loss-making PSUs. The government also did not provide guarantees for it to raise funds from financial institutions.

At one point, TSPL needed a mere ₹ 150 crore to revive itself but no money came forth from the Centre.

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