India’s ministry of steel is working on another bail-out fund, of $118 million, for cash-strapped government-run steel producer Rashtriya Ispat Nigam Limited (RINL), government sources said on Friday, December 20.
According to the sources, the fresh infusion of funds should come through around mid-January.
The fine-print of the fund infusion proposal has been finalised and will be forwarded to the ministry of finance following which it would go to the Cabinet of Ministers for the final approval, the sources added.
Lasts month, the Indian government infused $196.11 million into RINL to enable it to tide over operational and financial issues.
In September, the government had infused $60 million as equity in RINL and working capital of $136 million to maintain RINL’s status as a ‘going concern’ as per audit rules.
RINL, which operates a 7.3 million mt per year capacity steel mill in the southern port town of Vishakhapatnam, has been forced to shut down two of its three blast furnaces (BFs) and the third one is being operated at minimal capacity owing to shortages of funds to procure raw materials with the company saddled with $4.16 billion in outstanding dues.
