India’s Union Steel Minister Ram Chandra Prasad Singh reaffirmed there is no scope of revision in the decision to dismantle SAIL’s Raw Material Division (RMD), reported local media. Mines under RMD’s control would be transferred to Odisha Rourkela Plant and Bokaro Steel Plant situated in Jharkhand. The minister said the dissolution of RMD is complete.
The state of West Bengal was hoping for a reversal in the decision as RMD’s headquarters is located in its capital Kolkata, many employees working there would lose their jobs. Sail’s board had approved the reconstructing a few months ago, which could save the company around Rs40bn, annually.
With the restructuring, the Durgapur Steel Plant (DSP) and IISCO Steel Plant (ISP) in Burnpur, West Bengal, will have no captive mines. But, the ex-steel minister Dharmendra Pradhan had ensured that the supply of iron ore to these plants would continue.
Also, Sail’s Chairman Soma Mondal plans to reduce the company’s net debt to around Rs300bn by the end of FY2021-2022. Sail targets to bring down debt by Rs150bn- 200bn in the coming months amid firm flat steel and improving long steel prices. In FY2020-2021, Sail had decreased its net debt by Rs161.31bn to Rs353.5bn.