Calcutta, April 24: The mini steel plants in Bengal may have to down shutters due to the scarcity of an essential raw material — billets — they used to procure from Durgapur Steel Plant (DSP).

According to industry sources, DSP, a unit of the Steel Authority of India (SAIL), is not fulfiling its commitment towards the rolling mill owners in the state. However, it is still dispatching huge quantities of billets to the northern region of the country.

“We have made huge investments to set up state-of-the-art rolling mills in Durgapur with the hope that DSP will supply our entire billet requirement. But not even a fifth of our requirement is now being supplied and we have been totally left in the lurch,” says Lalit Beriwal, director of Shyam Steel Industries Ltd (SSIL).

The SPS group, another major producer of construction grade steel, is also facing the same problem in running its one-lakh tonne plant in Durgapur. Managing director Bipin Vohra said the mini steel plant owners were already in a very tight spot because of the non availability of raw materials like coal and iron ore.

“Now, the billet problem has assumed an enormous proportion with DSP failing to meet the local demands,” he said.

The situation has come to such a pass that over 10,000 people, who have been associated with the mini steel plants directly or indirectly, may be rendered jobless.

Sources said DSP has been forced to dispatch majority of its billets to the northern region because of political pressure.

“The ruling combine in the Centre wants to woo the major steel consumers in the northern region where it has a political support base, which it does not have in Bengal. Hence, there is a pressure on the DSP management, especially in view of the elections,” they said.

However, a senior DSP official said production has been hit in the plant over the last few months because of the lack of coking coal. “That is the reason why we were not able to cater to the demands of the mini-steel producers,” he said.

Both Beriwal and Vohra said the steel industry attracted most of the investments that trickled into the state over the last couple of years.

“The situation is making us think twice as far as further investments for capacity expansion is concerned,” Beriwal said.

Vohra added that the construction sector in the eastern region will also be under pressure if the mini steel plants are forced to shift base.

The state government has already taken a strong exception to the entire issue and has taken up the matter with the ministries concerned at the Centre.

But with the election fever on, the mini-steel plant owners are not very hopeful of anything positive coming through right now.