The Indian government is exploring the merger of Rashtriya Ispat Nigam Ltd (RINL) with another state-owned steel company, SAIL, as a potential solution to address RINL’s financial and operational challenges.
RINL, operating India’s first shore-based integrated steel plant in Visakhapatnam, Andhra Pradesh, has been struggling due to a lack of captive iron ore mines, which labor unions cite as a major contributor to its crisis.
To ensure continuity of operations, the government is considering various plans, including selling a land parcel to NMDC and securing bank loans. Recent discussions involving the DFS secretary, steel secretary, and officials from public sector lender SBI, which has significant loan exposure to RINL, indicate a desire for a permanent resolution to the issues at hand.
Additionally, options for arranging capital and monetizing assets through the sale of 1,500-2,000 acres of land for a pellet plant are being considered. Currently, RINL is operating at minimal capacity with only one of its three blast furnaces in use, leading to continuous losses.
