Monday, March 1, 2021

Vizag Steel Plant: will Centre accept Jagan’s proposal?

  • AP CM put forward 3 suggestions to Centre
  • Support plant by all means, request Unions
  • State Government has no rights on Steel plant, CM clarifies

Vizag:  AP Chief Minister Jagan Mohan Reddy came up with three suggestions to Central Government to salvage the plant. He said the same when he met the union leaders of Steel Plant on Wednesday at Vishakhapatnam. According to CM, allocation of mines in Odisha, converting bank debits into equity and making surplus lands of steel plant as lay out and selling the plots are the three suggestions given by him in his letter to the prime minister. Odisha has plenty of Iron ore reserves and mines should be allocated to VSP there, Reddy said.

Out of Rs. 22,000 crore debt the plant has, Rs. 11,000 crore was availed as working capital debt which includes some debts availed at hefty interest rate of nearly 14%. They can be converted into equity to reduce the burden of interest. This could help reduce debt between Rs 2,500 crore and Rs 3000 crore, enabling the company to rerun to profit, Jagan further added.

Also Read: POSCO & Hyundai want to have VSP with 50 % Share

Another suggestion given by Reddy was, 7000 acres of land lying idle of the total 20,000 acres VSP owns and if this land is converted  into plots and enable Steel Plant to sell them the profits from the sales can be used to salvage the plant. Reddy also assured that his government will be forthcoming in giving permission for land use conversion without any objection. This can prevent the plant from being privatised and can be retained with the government and turn into healthy institution.

“I wrote a letter to PM 10 days ago, expecting a positive reply from Centre,” CM said. “Do not go for strike and give chance to others that plant has stopped   production, support it by all means to not reduce production, State Government has no powers on Steel Plant as it is a Central government Institution, but let us all be nited and change the minds of Delhi people in our favour,” Jagan advised.

Also Read: Vizag Steel Plant : TDP gets a breather

In his meeting with the union leaders, Jagan confirmed that Posco executives visited the State and had met him, but they were looking for locations in Kadapa, Krishnapatnam and Bhavanapadu for their investment plans. If they come to one of these places, people will get jobs and economy will improve, CM clarified.

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