KADAPA: The long-pending dream of Kadapa to have a steel plant so as to address unemployment and migrations in search of jobs, is all set to be realised. Chief Minister YS Jagan Mohan Reddy will lay the foundation stone for the steel plant — AP High-Grade Steel Corporation — on Monday.
The steel plant to be located between Sunnapurallapalle and Peddanandaluru villages in Jammalamadugu mandal of the Kadapa district is expected to start production in three years and create direct and indirect employment for 20,000 people.
With the State government’s laws stipulating that 75 per cent of the jobs in the industries should be provided to the local youth, several unemployed in Kadapa and neighbouring districts are expected to get a major chunk of jobs.
It is the third time that the foundation stone for a steel plant is being laid. Former Chief Ministers YS Rajasekhara Reddy and N Chandrababu Naidu had laid the foundation stone for the steel plant at two different locations in the district, but unfortunately, they failed to materialise. People of the district hope that the third time might prove lucky for them.
The signing of an MoU with National Mineral Development Corporation (NMDC) for supply of iron ore to the proposed steel plant has strengthened that hope.
On December 18, 2019, the State government signed a Memorandum of Understanding (MoU) with NMDC for the supply of iron ore to the AP High-Grade Steel Limited. As per the agreement, the NMDC will supply five million tonnes of iron ore to Kadapa steel plant per year.
The agreement was signed following an appeal made by the Chief Minister to Union Minister of Steel Dharmendra Pradhan during the latter’s visit to the State in November. Setting up of the steel plant in Kadapa district is one of the provisions of the AP Reorganisation Act, 2014.
The State government has already allocated 3,146.68 acres and the possession certificate was handed over to AP High-Grade Steel Corporation CMD Madhusudhan Reddy on December 17. Further, two tmcft of water from the Gandikota reservoir has been allocated. The government has also allocated Rs 250 crore in the budget for the steel plant.
Initially, the government made efforts to establish the steel plant in a public-private partnership mode, but when it failed to materialise, it decided to establish the plant on its own and formed AP High-Grade Steel Corporation. Meanwhile, it also sought certain incentives to the plant from the Centre including a refund of IGST for the first seven years and income tax exemption for 10 years.
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Former Chief Minister YS Rajasekhara Reddy laid the foundation stone for the steel plant near Ambavaram in Jammalamadugu mandal on June 10, 2007.
Named Brahmani Steels, it was owned by former minister of Karnataka Gali Janardhan Reddy. At that time, the State government had allocated 10,760 acres of land for the steel plant and another 3,115 acres for the airport. The steel plant was supposed to be completed in 18 months and provide jobs to about one lakh people in a phased manner.
However, it was embroiled in a major controversy and got shelved with the company’s MD Janardhan Reddy getting jailed and YS Rajasekhara Reddy’s untimely demise. When the State was bifurcated, a steel plant in Kadapa was one of the provisions of the AP Reorganisation Act, 2014.
The TDP, which came to power in 2014, promised to establish the steel plant and its efforts to set up the plant with the help of Centre failed to yield results. The Steel Authority of India Limited (SAIL) conducted a feasibility study and it was reported that a steel plant in Kadapa was not feasible. After furore over report, the Centre engaged MECON to conduct another feasibility study and the report is expected shortly.
The then TDP government, following the hunger strike of TDP Rajya Sabha member CM Ramesh and MLC BTech Ravi, announced to establish the steel plant on its own. Naidu announced that the State government will set up the steel plant and subsequently Rayalaseema Steel Corporation Limited was formed. Around 3,500 acres was allocated. Naidu laid the foundation stone for the steel plant on December 27, 2018. After the TDP lost the 2019 elections, the Jagan government scrapped Rayalaseema Steel Plant Corporation and set up AP High-Grade Steel Corporation in its place.
