‘Plant will turn profitable if captive mines are allocated and debt is converted into equity’
Leading a rally under the banner ‘Visakha Ukku Parirakshana Porata Yatra’, here on Saturday, YSR Congress Party MP V. Vijaya Sai Reddy, said that the State government and the party will not allow the proposed strategic sale of Visakhapatnam Steel Plant (VSP), at any cost.
Over 1,000 YSRCP leaders and workers, trade union members and from other political parties, joined the padayatra that began from Gandhi statue, near the GVMC office. The yatra, which covered over 23 km, culminated into a public meeting at the steel plant.
Speaking at the public meeting, Mr. Vijaya Sai said that two things were responsible for losses in the VSP. He said that production cost was high as the plant didn’t have captive mines. He said that the VSP had invested around ₹1,500 crore in the Orissa Minerals Development Company (OMDC) for captive mines, but the mines have not been handed over yet.
He said Chief Minister Y.S. Jagan Mohan Reddy is aware of the mines issue and is ready to allocate the mines in Prakasam district, but they are low grade mines and they would not suit the VSP’s requirement.
Mr. Vijaya Sai said that the mines located at Karnataka-Andhra Pradesh border are under legal litigation and cannot be allocated.
He said that due to the expansion of the plant from 3 to 7.3 million tonnes, the VSP has incurred a debt of about ₹ 20,000 crore and it has been paying around ₹2,700 crore as interest.
“If captive mines are allocated and the Union government takes a decision to convert the debt to equity, the plant would turn profitable in a short time,” he said.
Referring to the POSCO management meeting the Chief Minister, he said during the course of discussion Mr. Jagan had asked them to leave the VSP and start a steel plant at Kadapa or Krishnapatnam. “The Chief Minister had also promised to provide them land,” Mr. Vijaya Sai said.
The MP also urged the VSP management not to reduce production, as it would plunge the company into further losses.
Hinting at management issues, he alleged that the top management is made up of officers from other States and they may not have the affinity towards the region, as locals would have.
Mr. Vijaya Sai said that efforts are on to meet the Prime Minister along with leaders from other political parties and trade unions and if appointment is given, he would raise the issue of debts, captive mines and recruitment of locals into the top management.
He said that VSP was established after a huge sacrifice by people and YSRCP will not allow it to be privatised and the agitation would continue till the Union government revokes its decision.
Tourism Minister Muttamsetti Srinivasa Rao, Visakhapatnam MP M.V.V. Satyanarayana, MLAs Gudivada Amarnath and A. Adeep Raj and others walked along with him for the 23 km.
Rajya Sabha member Pilli Subhash Chandra Bose, Agriculture Minister Kurasala Kannababu, Fisheries Minister Seediri Appalaraju, MLA Golla Babu Rao, leaders from various trade unions and others were present. Nagari MLA R.K. Roja and Anakapalle MP B.V. Satyavathi also joined the walk for some time.