The Odisha Government has been requested to release ad-hoc payment of Rs 100 crore immediately in favour of the Neelachal Ispat Nigam Limited (NINL) to run the plant and avoid its shutdown.
MMTC CMD Ved Prakash has made this request to the State administration as the steelmaker is facing tough time due to paucity of funds.
While the NINL is regularly requesting MMTC to release funds for the plant, now MMTC has approached the State Government to provide fiscal cushioning for the steelmaker.
Source said the MMTC has infused Rs 470 crore in the NINL during the last one year.
Earlier, NINL Managing Director SS Mohanty had also written to the State Government requesting to release Rs 250 crore as the plant is facing labour unrest for pending dues.
Currently, the NINL is facing hardship in paying the bills for power port and other statutory charges like bank charges to avoid NPA. Railway freight charges are needed to be paid in time to avoid stoppage of coal movement. Similarly, funds are also needed for operation of iron ore mines.
In the meantime, the NMDC has provided Rs 60 crore.
It is now expected that the Odisha Government, which is a shareholder, will release an ad hoc payment to ease fiscal stalemate.
While the Cabinet Committee on Economic Affairs (CCEA) has accorded approval for strategic disinvestment in the NINL, the company, according to the Governments, has got wide scope for 1-MTPC to 10-MTPA with infusion of funds.
The Centre has decided to disinvest the shares of MMTC, NMDC, BHEL, MECON, OMC and IPICOL in NINL.
Now, the shareholders are to infuse funds to run the plant so that it will fetch high value during disinvestment and keep alive the plant, said an industry expert.