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Govt plans to divest stake in Salem Steel Plant in Tamil Nadu

LiveMint logoLiveMint 31-07-2017 PTI

New Delhi: The government is planning strategic disinvestment of the Salem Steel Plant in Tamil Nadu and not total disinvestment, the Lok Sabha was informed on Monday.

Steel minister Chaudhary Birender Singh said the financial reports of Salem Steel Plant in the last few years showed a “dismal” picture of the once most-reputed steel plant in the country. “There is a proposal for strategic disinvestment of the Salem Steel Plant, not total disinvestment,” he said during Question Hour.

The minister said legal advisers and surveyers have been deployed to make a detailed analysis of the plant and a decision on the future of the plant would be taken after receiving their reports.

Singh added that the plant, which produced 3.39 lakh metric tonnes per annum of steel, was considered to be the country’s best plant producing stainless steel.

The minister said it has come to light that the plant’s 46% loss has happened due to high power tariff and the Tamil Nadu government has been requested to provide power at reasonable rates.

Replying to another question, Singh said India has a crude steel capacity of 126 million tonnes as on March 2017.

The minister said the crude steel capacity added from 2007-08 to 2016-17 was 66.49 million tonnes. During this period, domestic finished steel consumption grew at a 6% compounded annual growth rate, and hence the reason for the financial health of the steel sector cannot be attributed to stagnant steel demand.

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