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Debt-ridden SAIL likely to stop financing RSP in Odisha

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Odisha Sun Times Bureau
Rourkela, Mar 6:

The debt-ridden Steel Authority of India Limited (SAIL) may stop financing the steel major Rourkela Steel Plant (RSP) in Odisha due to ongoing financial crisis in the company.

If the situation does not improve by March 15, the company has no alternative except stopping financing the steel plants and other mining industries, warned SAIL finance director Anil Choudhary.

With the move, the payment and salaries of the employees and contractors will be delayed in the RSP.

According to Board of Directors’ review meeting held on February 9, the private companies including Tata Steel, Jindal Steel Works (JSW) and Jindal Steel & Power Limited (JSPL) have registered profit despite economic crisis in the steel sector in India. However, the steel plants under SAIL, one of the largest state-owned steel making company, registered Rs 3,432 crore loss in the past nine months by December last year.

As the prices of imported coking coal have reduced, the buyers are demanding to cut steel prices accordingly. This is the reason that sale of steel by SAIL has been confined to only Rs 3,754 crore, which is disappointing, reports said.

Meanwhile, the Centre has given its nod for outright sale of three SAIL steel plants including Alloy Steels Plant (ASP), Salem Steel Plant (SSP) and Visvesvaraya Iron and Steel Plant (VISP). The process for proposed disinvestment will commence from April. With the disinvestment of ASP, SSP and VISP, the speculation for acquiring Odisha’s Kalinga Nagar based Nilachal Ispat Nigam Limited by the SAIL has been put into rest.