Neelachal Ispat In The Red, MMTC Neglect Continues

Bhubaneswar: Dark clouds hang over the future of the public sector steel unit, Neelachal Ispat Nigam Limited(NINL) at Kalinga Nagar, thanks to the constant neglect of Central PSU, the Minerals and Metals Trading Corporation(MMTC) of India.

NINL an integrated steel plant was jointly promoted by MMTC and two state PSUs-OMC and IPICOL and starving for additional investment for its smooth running. To overcome the financial crisis, the company at present needs at least Rs 300 crore.

While 49.78 per cent of the equity of NINL is held by MMTC, the state PSUs together hold 27.61 per cent of its equity. An amount of Rs 149.34 crore stands against the MMTC which it was supposed to pay towards the investor’s share in the last two years.

To ameliorate the resource crunch faced by NINL, Chief Ministser Naveen Pattanaik in a letter has requested Union Minister of State For Commerce and Industry, Nirmala Sithraman to instruct MMTC to provide additional equity support to NINL at the earliest for its survival.

Naveen’s letter added,”Due to depressed market conditions, the company has been incurring losses since 2012-13 and in order to improve its financial condition, the company has undertaken various measures such as refinancing its existing projects and loan under the refinance scheme in the 2015-16 fiscal”.

The state government has already executed a lease for iron ore mining in favour of NINL to provide assured supply of raw material. The company has given employment to around 3,700 persons.

This apart, Odisha government has already accorded its approval for infusion of equity of Rs 80 crore since last two years as pro-rata share by OMC.