Beni spikes NMDC’s plan to go solo on maiden steel project
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In a blow to public sector miner NMDC's efforts to set up a mega 3 million tonne steel plant at Nagarnar in Chhattisgarh on its own, steel minister Beni Prasad Verma has asked the state-owned mineral major to rope in steel maker Rashtriya Ispat Nigam Limited (RINL) for jointly setting up the project.
The move is likely to come as a setback for NMDC, which had so far touted the greenfield project as its maiden steel venture It had acquired 788 acres of private land for the plant worth about Rs 15,000 crore for which it has disbursed Rs 85 crore to 1,052 families.
"Ever since I assumed the charge of the steel ministry, I am of the firm opinion that NMDC's core competence is mining and not in making steel. Since the NMDC top brass is of the opinion that they have already proceeded well ahead, I have asked them to rope in our RINL in setting up the plant," Beni Prasad Verma told The Indian Express today.
The steel minister's directives also comes amid concerns raised by the finance ministry that the PSU miner should restrict itself to the area of its core competence. NMDC chairman CS Verma was unavailable for a comment.
Justifying his contention, the steel minister said if NMDC is allowed to set up the plant on its own, there is a risk of the state-run company deviating from its mandated job.
Even Verma's predecessor Virbhadra Singh had objected to NMDC constructing a steel plant, saying it defeats its stated goals. "We are unaware of any steel plant set up by any globally reputed miner for similar reason. In fact such a tie-up should have been executed long back," steel secretary DRS Chaudhary told this newspaper.
RINL CMD A P Choudhary said, "We will follow the ministry's directives and I believe that this project will benefit both the industry and the locals through employment." A ministry source said both NMDC and RINL would be asked to share 50 per cent equity each in the steel project.
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