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The Centre is only looking at a strategic divestment in Salem Steel Plant (SSP) in Tamil Nadu and not intending to de-nationalise it, said Steel Minister Chaudhary Birender Singh.
Transaction advisor, legal advisor and valuer have been appointed and their reports are awaited, Singh told the Lok Sabha on Monday during question hour.
A final decision on the way forward is yet to be taken, he said, adding that the proposal is that of strategic divestment of SSP and not full exit.
“There is already a decision by the Cabinet on Strategic divestment. It is not total disinvestment but only strategic disinvestment,” Singh said.
SSP has capacity of 3,39,000 tonne per annum and is the only plant in the country with best quality stainless steel, Singh said. However, for the last five years of 2011-16, the total aggregate loss of SSP is to the tune of ₹1,855 crore and SAIL has invested ₹2,200 crore in this plant, he said.
The major factor that caused losses is the high electricity tariff, which accounted for 46 per cent of the losses, he said. The Centre’s efforts to make the Tamil Nadu government provide concessional electricity to SSP did not yield any result, the Minister noted.
M Thambidurai, senior AIADMK Leader and Deputy Speaker of Lok Sabha, urged the Union Steel Minister not to go in for any disinvestment of Salem Steel Plant.
The issue of high tariff cost could be addressed if the Centre comes forward to give electricity with subsidised tariff to the Salem Steel Plant, he suggested.
Thambidurai also highlighted that he had already taken a delegation consisting of employees to the Steel Minister and had pressed for revival of the SSP while keeping it under the central government. The Tamil Nadu Chief Minister Edappadi K Palaniswami had also recently written to the Centre urging it not to undertake divestment in Salem Steel Plant, he said.
Meanwhile, the Steel Minister said that domestic steel production is expected to increase to 240 million tonnes by 2030-31, when the capacity will go up to about 300 million tonnes as per the recently rolled out National Steel Policy.
The Cabinet had three months ago approved a new National Steel Policy.
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