CITU threatens stir for captive mines to VSP

Plans to launch massive agitation, the ‘Vizag Steel March’ on April 5 demanding that the Central government allot captive mines to VSP

Visakhapatnam: The CITU has planned to launch a massive agitation, the ‘Vizag Steel March’ on April 5 demanding that the Central government allot captive mines to Visakhapatnam Steel Plant (VSP).

In this connection, it will take out a huge procession from the steel plant to the Collectorate in the city. In the recently held trade union elections, the CITU emerged as the recognised union of the VSP.

Addressing media here on Monday, CITU state president Ch Narasinga Rao said the VSP has been facing severe losses due to lack of captive iron ore mines. The VSP with its own funds, has expanded the plant’s capacity from 3.2 to 6.3 million tonnes.

Meanwhile, the VSP had already paid Rs 37,066 crore to the Centre as dividends and taxes. However, due to the sluggish market across the world, the VSP has been facing losses to the tune of Rs 2,621 crore during the past two fiscal years. The main reason behind the losses is due to lack of captive iron mines.

“To produce 1 million tonnes of steel, 1.6 tonnes of raw material are required. The other steel plants in the country are procuring the raw material at Rs 600 per tonne and the VSP is buying raw material at Rs 4,000 per ton due to lack of captive mines. The VSP is spending 54 per cent of its expenditure to procure the raw material only,” Narasinga Rao, said while explaining the VSP’s financial 
crisis.

The Centre is not taking any decision, even after repeated requests, urges and agitations for captive mines. In order to mount pressure on the Central government,  the CITU has decided to launch a massive agitation at  Vizag Steel March on April 5, he added.

The VSP already purchased iron ore mines in Odisha and also paid Rs 361 crore to Odisha Mineral Development Corporation. 

However, as the Central government not renewed the mining licenses of OMDC, the VSP has not yet imported even a single tonne of raw material. The TDP MPs who are in NDA government’s alliance partners did not even give a tough fight for securing the mines, Narasinga Rao lamented. Even the State government has not responded so far though the VSP urged it seven times till now, he added  

There are iron ore mines in AP and according to the assessments made, the ore is 8,787 million tonnes in Prakasam district. Though the VSP urged several times, there is no response from the state government. The state government informed to VSP that the raw material would be supplied through APMDC instead of allotting the mines to the VSP, Narasinga Rao lamented.