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Centre firm on privatisation of Vizag Steel Plant

Centre firm on privatisation of Vizag Steel Plant

The National Democratic Alliance government at the Centre led by Prime Minister Narendra Modi has once again made it clear that it would go ahead with the privatisation of Visakhapatnam Steel Plant as decided earlier, despite the fact that the public sector undertaking has achieved record turnover and has been making profits.

Union minister for steel Bhagavat Kishan Rao Karad told the Rajya Sabha that the Centre was committed to its stand on 100 per cent privatisation of Visakhapatnam Steel Plant and there is no question of going back on the same.

Replying to a question raised by Telugu Desam Party MP Kanakamedala Ravindra Kumar, the minister said the Centre had already taken a decision in this regard and had initiated steps for the privatisation process.

The Department of Public Investment and Public Assets Management (DIPAM), under the Ministry of Finance has already started the process for 100 per cent strategic disinvestment of RINL, its joint ventures and subsidiaries. 

The Centre recently issued separate notifications for appointment of a transaction advisor and legal advisor to implement the disinvestment process. The government has called for expression of interest from interested bidders on the privatisation of the steel plant.

It may be mentioned that the Cabinet Committee on Economic Affairs (CCEA) on January 27 had accorded in-principle clearance to the proposal for sale of Government of India shareholding in RINL by way of privatisation.

Interestingly, the Visakhapatnam steel plant, whose corporate name is Rashtriya Ispat Nigam Limited (RINL), has posted a turnover of Rs 5,223 crore during the first quarter of current financial year as against Rs 2,306 crore during the same period last year, registering a growth of 126 per cent.

The company's sale of saleable steel during the first quarter of FY 2021-22 stood at 10.43 lakh tonnes against 6.78 lakh tonnes of CPLY registering a growth of 54 per cent. During Q1, saleable steel production was 12.37 lakh against 6.26 lakh tonnes registering a growth of 98 per cent. 

Saleable steel volume in domestic sales stood at 7.43 lakh tonnes against 3.67 lakh tonnes last year, registering a growth of 103 percent. Notwithstanding the fallout of COVID-19 pandemic during 2020-21, RINL achieved a turnover of Rs 18,000 crore, the second-highest-ever since its inception. 

It had registered an impressive growth of 13 per cent. The sales volumes reached 4.45 million tonnes recording a growth of 4 per cent.

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