Union cabinet clears disinvestment in NINL

BHUBANESWAR: The Union Cabinet on Wednesday approved disinvestment of equity share of six PSUs including two under the state government in the loss-making Neelachal Ispat Nigam Limited (NINL) thereby paving way to bring in new investors through auction. The state government welcomed the move.
While Central PSU Mines and Metals Trading Corporation Ltd (MMTC) holds majority stake of 49.78 per cent in the company, Odisha Mining Corporation and Industrial Promotion and Investment Corporation of Odisha Ltd.(IPICOL) holds 20.47 per cent and 12 per cent stakes respectively.Three other CPSUs--NMDC, MECON and BHEL--hold minor share in the firm.
Lack of capital investment by the existing equity holders had forced the management to operate only the coke oven of the plant at Kalinganagar in Jajpur district.
The state government has earlier given its consent to the Centre for the disinvestment, said official sources.
Briefing reporters after the Cabinet meeting in New Delhi, Union steel minister Dharmendra Pradhan said the decision to divest equity share of the existing agencies will lead to technology and capital infusion by new investors and improve productivity.
“The decision will also help in increasing production capacity from the existing 1.1 mtpa to 10 mtpa in two phases. It will also increase the employment opportunities in the plant and accelerate the socio-economic development of the region,” Pradhan told reporters.
The new promoter will invest resources in new global standard technology to revive the plant. The move is also part of the Centre’s strategy in the National Steel Policy-2017 to ramp up country’s total annual steel production to 100 MT by 2030 of which Odisha is expected to contribute 30 per cent, said official sources.
Over 2500 employees of the plant including 1540 regular employees had earlier urged the Central government’s intervention for its revival.
Experts believe that the strategic location of the NINL plant situated over an area of around 2500 acres and the Koida iron ore mines spreading across Keonjhar and Sundargarh district with total deposit of 102 million tonne of ore will draw key players in the steel sector to take over the unit.
With the Centre plans to develop steel hub at Kalinganagar, a region that houses more than 10 small and large steel plants, revival of NINL is expected to boost the downstream and ancillary industries.
State industries minister Dibya Shankar Mishra welcomed the Centre’s move saying, “The decision will not only revive the plant by infusing cutting-edge technologies by the new investors but also facilitate socioeconomic development of the region and create new job opportunities.”
“The plant will be a big boost for the micro, small and medium enterprises in the region and promote new entrepreneurship,” said Mishra.
Senior Congress leader Ramachadnra Khuntia opposed the move of the Centre saying, “It was unfortunate that the decision came on a day when the trade unions across the country observed bandh opposing the disinvestment policy of the Union government.”
Citing the NINL as the second public sector steel plant in Odisha, Khuntia said the Centre could have easily revive it through the existing stakeholders of the Union and state government.
“Instead of doing that, they have decided to withdraw stakes of PSUs. The move might be intended to benefit some of the industrialists. We will continue to oppose it,” said Khuntia.