The strategic divestment of the steel maker Rashtriya Ispat Nigam Limited (RINL) would lead to capital infusion, capacity expansion, technology and better management practices, the Union Steel Minister Ram Chandra Prasad Singh said in a written reply in Lok Sabha, on Wednesday.
Singh said, RINL has “not increased its profits” during the last ten years, and its cumulative losses were ₹7,122.25 crore. Steel Production has been going on since 1992 at RINL-VSP. In FY21, the company reported a net loss of ₹789.10 crore against ₹3,910.10 crore loss in FY20.
“This strategic disinvestment of Government of India’s equity in RINL would lead to infusion of capital for optimum utilisation, expansion of capacity, infusion of appropriate technology and better management practices with resultant higher production and productivity and expansion of direct and indirect employment opportunities,” he said.
Singh added that his Ministry had endorsed requests of RINL to the state governments of Odisha, Chhatisgarh and Andhra Pradesh by recommending reservation of iron ore deposit under Section 17A (2A) of Mines and Minerals (Development and Regulations) Act, 2015 to the Ministry of Mines.
The Ministry of Steel has also requested the Odisha government to reserve an iron ore block in favour of RINL. RINL has also been participating in the allocation of Iron Ore Mines through e-auction route, he added.
Incidentally, the Cabinet Committee on Economic Affairs (CCEA), in 2021, had accorded “in-principle” approval for 100 per cent disinvestment in RINL and its subsidiaries and joint ventures (by way of privatisation).
Singh said no decision has been taken yet on the transfer of land. Presently, 19,703.1 acres of land is under the possession of RINL for the steel project.
The Cabinet Committee on Economic Affairs (CCEA), in its meeting on January 27 last year had accorded “in-principle” approval for the Centre’s disinvestment of RINL and in its subsidiaries or JVs through strategic disinvestment by way of privatisation.