| Riding on
New Delhi, May 28: With a balance-sheet that looks less messier now than it did a year back, SAIL feels it has the cash comfort to press ahead with the revival plan for IISCO, a subsidiary gasping for the Druidic potion.
“We will take up the Rs 890-crore package for IISCO. We can finish the task in two years,” chairman V. S. Jain said. The revival report prepared by IDBI is with the Board for Industrial and Financial Restructuring.
Of the total amount set aside to breathe new life into IISCO, Rs 240 crore will be spent on relining blast furnaces at the Burnpur factory, besides revamping its rolling mill and sinter plant; another Rs 111 crore will be used to spruce up collieries and mines. The “small but strategic” investments will go a long way in raising Burnpur unit’s capacity by 45 per cent to 5.4 lakh tonnes.
A new round of voluntary separation package, which Jain says has already proved successful at the factory in Kulti, will soak up Rs 540 crore.
The attempt to turn around IISCO has been a stop-go affair, stalled by politics at one time and supported by it on other occasions. What gives it a greater degree of urgency this time is the elections next year, when the BJP and Trinamool Congress would like to use IISCO’s revival to court Bengal’s voters.
As it wrestles with ways to haul IISCO out of the sick bay, SAIL will also give its own plants a cash injection.
Rourkela Steel Plant will get Rs 210 crore this year, of which Rs 120 crore will be spent on a coke-oven battery and Rs 90 crore on a pipe unit. Durgapur Steel Plant should receive Rs 155 crore; it will sink Rs 125 crore in a bloom caster and Rs 30 crore in a ladle furnace.
Sources said the infusion in Rourkela was more in the nature of “corrective investments to make up for past mistakes.”
The Bhilai and Bokaro plants will be entitled to larger outlays, partly because they are in better financial shape and also because their rusty and old machines are long due for a replacement. Bokaro will be given Rs 200 crore to modernise its cold rolling mills — a plan that will be cleared in two months — and Rs 120 crore to upgrade its coke-oven battery. Bhilai’s rail mill, which makes tracks for the railways, should be handed Rs 320 crore for a much-needed update.