Demerger of Nagarnar Steel Plant from NMDC Likely to be Delayed
As per recent media reports, India's largest iron ore producer NMDC may have to wait till the end of monsoon this year before commissioning its three million
As per recent media reports, India's largest iron ore producer NMDC may have to wait till the end of monsoon this year before commissioning its three million ton steel plant and initiating the process of its demerger and subsequent disinvestment. Reports quoted government sources as saying that though 3 million tonne steel plant is likely to be commissioned in July-August 2021, it could be delayed beyond monsoon and are likely to coincide with the demerger of the steel plant. This would allow for completion of work on a byproduct unit and coke oven batteries. So, the demerger process itself may get extended to late this year or in the first quarter of calendar year 2022
The Board of Directors of the NMDC in August had already accorded in principle proposal to demerge the Nagarnar Steel Plant with itself. In October, the Cabinet Committee on Economic Affairs approved the demerger of the Nagarnar Steel Plant or NMDC Iron and Steel Plant from NMDC and strategic disinvestment of the demerged entity by offloading the entire government shareholding to a buyer. After the process is completed, the Nagarnar Steel Plant shall be a separate company and the managements of the NMDC and the Nagarnar Steel Plant shall be accountable for their respective operations and financial performance.
Nagarnar Steel Plant is a 3 million ton per annum Integrated Steel Plant being set up by the NMDC at Nagarnar in Chhattisgarh's Bastar district in an area of 1,980 acres at revised estimated cost of INR 23,140 crore. As of October, the NMDC has invested INR 17,186 crore on the project out of which INR 16,662 crore is from its own funds and INR 524 crore has been raised from bond market.