Andhra Pradesh Chief Minister Y S Jagan Mohan Reddy on Friday called on Union Steel and Petroleum Minister Dharmendra Pradhan and urged him not to privatise Visakhapatnam Steel Plant (VSP). On his second day of a two-day visit to Delhi, Reddy held over an hour-long discussion with Pradhan on the Kakinada Petro Complex and VSP, according to an official statement.
In the meeting, the CM appealed to the central government to stop privatisation of VSP and requested it to consider the alternatives suggested by the state in reviving the plant.
He said 20,000 people are employed in VSP and thousands more are having indirect employment. The company performed well and generated profits between 2002 and 2015.
The plant has gone through an expansion by taking loans, but due to the slump in the international market during 2014-15, the company fell into debts with the increasing operational costs and lack of own mines, he said.
Reddy requested to allot the captive mine in Odisha that will help in reviving VSP. He also suggested other possibilities in restructuring the finances of VSP, where all the short-term and long-term loans could be converted into equity easing the burden.
The plant has a debt of Rs 22,000 crore, which is being serviced at interest rates as high as 14 per cent. Conversion of these loans into equity and listing the entity on the stock exchange,