Demand for merger of Rashtriya Ispat Nigam Limited and National Mineral Development which was dropped after the latter expressed its disinclination, is gaining momentum again with many clamouring for it.
Mooted in 2008 by RINL management as a mutually beneficial solution to its raw material insecurity and NMDC’s plan to foray into steel manufacturing, the proposal is being broached by the employees of Visakhapatnam Steel Plant.
“We want to represent to Ministry of Steel shortly to consider the suggestion, which mutually beneficial for RINL and NMDC,” Visakha Steel Employees’ Congress (recognised union) general secretary Mantri Rajasekhar told The Hindu.
ADVERTISEMENT
VSP unions including those belonging to CITU and AITUC are of the opinion that merger will be the best option. An official of RINL said merger would also help both the entities to emerge as a formidable force both in India and overseas market.
RINL, which is in the process of getting listed, is the corporate entity of VSP. NMDC, which has its headquarters in Hyderabad is the State-controlled mineral producer and has long-term agreement with RINL to supply iron ore extracted from Bailadilla mines in Chattisgarh to meet raw material requirement of VSP.
VSP is now stabilising expanded units under its 6.3 million tonne project executed at a cost of Rs.12,300 crore. Incidentally, both RINL and NMDC are under administrative control of Ministry of Steel. NMDC is establishing three million tonne steel plant near Jagdalpur in Bastar. On the other hand, RINL has a rich land bank with 25,000 acres under its ownership with dream to make VSP as the largest single location integrated steel plant in future.
ADVERTISEMENT
NMDC, which is expected to produce 30 million tonne of iron ore during 2014-15, has set a target to produce 50 millon tonne by 2018-19 and 100 million tonne by 2024-25.