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Iconic Steel Plant in Andhra Pradesh to be Privatised

by Staff
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On January 27th, 2021, the Cabinet Committee on Economic Affairs effectively approved 100% strategic disinvestment of the Government of India’s holding in Rashtriya Ispat Nigam Limited (RINL) which runs the Vizag Steel Plant (VSP) along with full management control of the same. The plant is an icon of the city and holds great heritage value in the minds of the people. In response to the move, massive protests were held in Andhra Pradesh over the last few days.

The steel plant has a rich history that traces back to the 1960s. In their demand to set up the plant, freedom fighters T. Amrutha Rao and Tenneti Viswanadham led a non-violent struggle that included thousands of students, workers, and citizens under the cheer of “Visakha Ukku, Andhrula Hakku”. The VSP was thus established and has since become a symbol of pride and resolve of the Telugu people. 

The plant provides permanent and contractual employment to more than 40,000 families in Visakhapatnam and Northern Andhra and is India’s first shore-based integrated steel plant. The company currently stretches across 19,700 acres of land and the land itself is estimated to be more than Rs. 1 lakh crore. Although the plant has incurred losses in recent years owing to a global slump in the steel industry and due to lack of captive iron ore, it has undertaken capacity expansion to 7.3 million tonnes and returned a monthly profit of Rs. 200 crores since.

The TDP National General Secretary Nara Lokesh wrote to Chief Minister Reddy calling his attention to the significance and sensitivity of the issue around the disinvestment of the steel plant in Visakhapatnam. He further advised the CM to demand that the Centre allocate captive mines to the steel plant or to pass a resolution for the State to buy the project from the Centre. The CM has written a letter to the Prime Minister requesting reconsideration of the disinvestment and exploring the option of captive mines to reduce input costs.

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