GVL for immediate intervention to solve VSP iron ore crisis
Says RINL deserves preferential treatment by NMDC, and not negative discrimination in comparison to private steel producers
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In a fresh letter to Union Steel Secretary Nagendra Nath Sinha, BJP national spokesman and Member of Standing Committee on Finance GVL Narasimha Rao said on Friday that as both the RINL and NMDC are under the administrative ambit of the Ministry of Steel, the problem faced by Visakhapatnam Steel Plant should be solved immediately.
“I am writing to urge you to intervene and suggest to NMDC to resume supply of iron ore from Bacheli and Kirandul mines in Chhattisgarh. As a Central Public Sector Enterprise (CPSE), the RINL deserves preferential treatment by NMDC, another CPSE and not negative discrimination in comparison to private steel producers,” he said.
GVL said since 1991 till a few months ago, RINL has been getting iron ore from Bailadilla reserves. These are the nearest and best quality iron ore mines at a distance of 560 kms from Visakhapatnam. NMDC is RINL’s main iron ore supplier and nearly 30 per cent of NMDC’s turnover and profits come from sale of iron ore to RINL. RINL has also cleared most of its payment dues to NMDC despite facing a challenging financial position.
“As most of the iron ore from Bacheli and Kirandul mines is being supplied to private steel producers, NMDC has now asked RINL to receive most of its iron ore requirements from its mines in Karnataka which is more than 900 km away from Visakhapatnam resulting in an additional expenditure of around Rs 800 per tonne on account of transportation. This has further added to the financial troubles of RINL. In addition, delays in forest clearances and shortage of railway wagons have added to the problem,” the MP stated.
At present, RINL is running with only four days stock of iron ore, while the plant requires a minimum 10 days of stock even to operate two blast furnaces and 15 days of stock to operate three blast furnaces. This is a matter of great concern and it needs timely intervention, the MP said. In another representation, he sought time-bound promotions for the RINL employees and executives.
