Kolkata | Aug 04, 2016: With the mine allocation policies getting rehashed by the Central government, the small and medium steel companies are feeling the heat now. The industries complained that the projects are getting delayed and payment pressure from the banks are mounting.
Earlier during the UPA regime, mines were allocated to the companies for their captive consumptions. Later, in the wake of allegations of irregularities of coal block allocation, the NDA government decided to conduct bidding for allocation of mines. The companies, which had already put in place their projects, found it difficult after the introduction of auction system by the government.
"Auction system is fair and we have no objection to that. But a lot of industries, who were supposed to get mines in different states, had their projects stalled. All allocations were stopped till finalization of the auction procedure," said Ashok Gutgutia, VC and MD of Burnpur Cement Ltd.
During a press conference, industry members said that they have approached President Pranab Mukherjee to intervene and help in sorting out the issue. "While the on going projects got delayed, industries came under pressure from the banks. This has also seen increase in the non-performing assets as the industries could not perform. The trouble was more for the small and medium companies," said Sanjay Bhalotia, a chartered accountant present at the press conference.
According to Indranil Dutta, head (corporate affairs) of Burnpur Cement, there are more than 100 small and medium companies in the eastern region which are finding it difficult to run units. "Whether they are in the steel sector or cement, everyone who is in need of raw materials from mines are facing the hurdle," he said.
(Source: http://timesofindia.indiatimes.com/)