Shivamogga(Karnataka) | Aug 18, 2015: The proposed visit of Union Minister for Steel and Mines Narendra Singh Tomar to Visvesvaraya Iron and Steel Plant (VISP), a public sector undertaking at Bhadravathi, on August 21, has created some optimism among the workers there.
The factory was established by Sir M. Visvesvaraya, the then Dewan of Mysore State, in 1923.
The State government handed it over to the Steel Authority of India Ltd., in 1998. For many years, the firm was supplying special and alloy steel to strategic sectors like defence, civil aviation, nuclear technology and auto components.
However, the firm has been incurring loss for the past few years. The VISP’s dedicated mine at Kemmannugundi was de-commissioned in 2004, following the expiry of lease period, owing to which the firm had to purchase iron ore from the open market. This worsened the financial condition of the company, as the cost of production increased and the profit margin decreased.
In 2009-10, 2010-11 and 2011-12, the company incurred losses of Rs. 100 crore, Rs. 129 crore and Rs. 130 crore, respectively. J.N. Chandrahas, president of VISP Employees’ Union, told presspersons here on Monday that the firm could be brought back on the path of earning profits by modernising it.
The antiquated production technology in the firm has been blamed for the losses. In 2008, the Metallurgical and Engineering Consultants (India) Ltd. (MECON), a public sector consulting agency, had recommended the SAIL to invest Rs. 3,392 crore to modernise VISP to make the firm economically viable, he said.
The management of SAIL had earlier said that it would invest on modernisation of VISP after State government sanctioned a captive mine for the firm.
The State government has agreed to sanction 141 acres of land in NEB range in Sandur taluk for VISP for mining purposes. The measurement of the land and fixation of boundaries of the allotted place has been completed. The captive mine would be handed over to VISP after the allotment is ratified by the Union government, he said. Mr. Chandrahas said that since VISP would get the captive mine soon, the employees union would request Mr. Tomar to provide funds for its modernisation. Union Minister for Chemical and Fertilizers Ananth Kumar and Shivamogga MP B.S. Yeddyurappa, who would be accompanying Mr. Tomar to Bhadravathi, have assured that they would apprise Mr. Tomar on the need to modernise VISP, one of Asia's oldest steel plants, he said.
The loss incurred by the firm had come down in 2013-14 and 2014-15. The modernisation was necessary to protect the interests of around 600 permanent workers and 2,000 contract workers, he said.
Functionaries of the union Rafiq Patil, Jagadish, Shivabasappa, Mallikarjun, Jayaprakash and Raghavendra were present.
(Source: http://www.thehindu.com/)