The Government of India has decidedly acted on its plan to revive the crucial stressed asset called, Rashtriya Ispat Nigam Limited (RINL). The Cabinet Committee on Economic Affairs (CCEA) finally approved an Rs 11,440 crore revival plan for it. According to sources, there will be a fresh equity infusion of Rs 10,300 crore to revive the project.
Union Minister for Steel HD Kumaraswamy said that RINL will achieve 14,000 metric tonne steel production in January and aim to achieve 92.3% of installed production capacity in the near future. The minister also added that two blast furnaces of RINL will begin operations in January itself while another will start running by August 2025. It should be mentioned here that RINL can produce roughly 7.3 million tonnes per annum (MTPA) of steel at peak capacity.
According to an official statement, the infusion includes conversion of Rs 1,140 crore working capital loan as 7% Non-cumulative Preference Share Capital redeemable after 10 years to keep RINL as a going concern. It is important as RINL has exhausted the sanctioned borrowing limits from banks for working capital due to which it was unable to get further loans from banks. Further, RINL also defaulted on the Capex Loan repayments and Interest payments in June 2024, the statement added.
Kumaraswamy said that RINL has outstanding dues of roughly Rs 35,000 crore, but added that these will be liquidated as the plant starts earning revenue.
