With a policy decision taken by it for a strategic disinvestment of its shares in the Nilachal Ispat Nigam Limited (NINL), the Government of India has asked the Odisha Government for its concurrence of the proposal so that it would go ahead with its move.
Union Secretary for Disinvestment and Public Asset Management (DIPAM), Atanu Chakraborty has requested the State Government to take a decision in this regard immediately.
The NINL is running a one-million-tonne-per-annum-capacity integrated steel complex at Kalinganagar and has a potential of 10 MT, said Chakraborty. It will need substantial capital infusion for tapping its full capacity. But its major promoter MMTC is not in a sound financial state and cannot pump in more funds for achieving its full potential.
The MMTC has so far advanced a loan of \Rs 2,800 crore to the NINL and has a paid-up capital of Rs 459 crore and has also given a Corporate Guarantee for Rs 1,346 crore. A high-powered committee of the Department of Commerce and Industry has recommended for a strategic disinvestment of the MMTC equity in the NINL.
Chakraborty has informed the State Government that as the Union Government has embarked upon a policy of strategic disinvestment of certain Central Public Sector Enterprises (CPSEs), the NINL is one of them. The NINL disinvestment proposal has been approved by Core Group of Secretaries on Disinvestment, chaired by the Cabinet Secretary. The NITI Aayog has also supported the move for NINL disinvestment.
Meanwhile, the Disinvestment and Public Asset Management Additional Secretary has held
discussions with senior officials of the Government of Odisha in this regard.
The NINL is a Joint Venture Company (JVC) with the shares of Union Government PSUs MMTC, NMDC, MECON and BHEL and those of State Government undertakings IPICOL and OMC.
Once the State Government concurs the present initiative, all the stakes of these PSUs, both of Centre and State Government, would be divested for strategic sale through the extant approved procedure in place. This would facilitate infusion of capital by a strategic buyer which would generate further employment opportunities in Odisha, the Union Secretary has said. Now, the ball is in the court of the State Government to take a call on the matter as the NINL was the dream child of Biju Patnaik as the State’s second steel plant.