VISAKHAPATNAM: The book value of land in possession of Rashtriya Ispat Nigam Limited (RINL), the corporate entity of Visakhapatnam Steel Plant (VSP), shown was a mere Rs 55.82 crore against the present market value of the land which can be around Rs 60,000 crore on conservative side.
Former CMD of RINL Y Siva Sagar Rao and former CBI joint director VV Lakshminarayana, in a joint letter to Prime Minister Narendra Modi said 19,703 acres, presently under the possession of RINL, is held in the name of the President and not in the name of RINL.
Releasing the letter written by them to the media on Friday, Lakshminarayana said the Rashtriya Ispat Nigam Limited value will go up from the present Rs 32,000 crore to around Rs 1 lakh crore following land transfer.Siva Sagar Rao said RINL procures iron from open market at the market price in the absence of captive mines and this is one of the reasons for RINL losses.
“At least 16,872 acres of land should be transferred to RINL so that the balance sheet of RINL will become robust and leads to a better credit rating which will help RINL raise more loans from the market at competitive interest rates. The remaining 2,830 acres may be explored by the Centre for further industrial development which may fetch around Rs 9,000 crore to RINL,’’ they said in the letter. They further said financial restructuring will help the plant improve its financial position.
Lakshminarayana said Neelachal Ispat Nigam Ltd should also be merged. He said there can be technical sharing and ore can be converted into coke and supplied to other plants from RINL. “Nearly 16,500 people were given rehabilitation cards (R-cards) and of them 8,500 have been given employment so far. As many as 8,000 R-card holders of the fourth generation are yet to get jobs,’’ he said.
For the immediate survival of the plant, the RINL needs around Rs 5,000 crore and this can be achieved through monetisation of land located at HB Colony and it will fetch Rs 1,000 crore. “Besides RINL should be allowed to sell forged wheel plant set up at Raebareli which will fetch Rs 2,500 crore. Similarly, RINL should be allowed to sell its stake in OMDC and it will fetch Rs 1,500 crore,’’ he said.Speaking to TNIE, an RINL official said proposals made by Sivasagar Rao and Lakshminarayana are pragmatic and will help RINL come out of the crisis.
Merger of steel plants sought
Former CMD of RINL Y Siva Sagar Rao and former CBI joint director VV Lakshminarayana suggested a mega steel giant with the merger of RINL, NMDC and SAIL on the lines of mergers in the petroleum sector. “This will help RINL save Rs 18,000 crore per annum at the present scale of production,’’ they said.