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Andhra PradeshVizag steel plant forced to pay additional Rs 60 cr annually for...

Vizag steel plant forced to pay additional Rs 60 cr annually for raw materials

Published: 1st Sep 2021 8:09 pm

Visakhapatnam: Coercive tactics by Gangavaram port has forced Visakhapatnam steel plant to pay an additional Rs.60 crore every year for import of raw materials, according to CPM state secretariat member and CITU state president Ch. Narasinga Rao.

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The VSP is importing coking coal, limestone and other raw materials on a regular basis. Coking coal is used in blast furnaces while limestone is used to remove the wastes in the blast furnace. “VSP is exporting steel on a large scale to other countries. After the Adani group took over the Gangavaram port recently, it began blackmailing the steel plant and brought pressure on it to hike the tariff. It stacked the limestone in its godowns and stopped supply to the steel plant from March this year,” he alleged.

Under an agreement reached in 2011, Gangavaram port has to transport raw materials for VSP till 2026 and the VSP was paying Gangavaram port Rs.284 per ton of limestone. “The agreement has to be honoured till 2026 but Gangavaram port forced VSP to hike Rs.60 per ton of limestone from March and further to Rs.120 per ton from December this year. Every year, VSP imports 18 lakh tons of limestone from Dubai and it has to pay Rs.70 crore more to Gangavaram port now,” he explained. With the VSP importing 50 lakh tons of coking coal from Australia, Africa and other places annually, Narasinga Rao feared that Gangavaram port could hike coking coal charges also in the same way and place unbearable burden on the steel plant. The handing over of Gangavaram port to Adani group had made things difficult for VSP. In the past, the Centre had control over tariff with respect to 12 major ports but it had allowed the private port managements to hike the tariff as they liked, the CPM leader stated. There is need for Centre’s intervention to ensure implementation on tariff agreement by Gangavaram port, failing which the consequences would be very serious, he warned.


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