The Indian government is not considering any proposal for a merger of the two state-run steel producers, Steel Authority of India Limited (SAIL) and Rashtriya Ispat Nigam Limited (RINL), junior minister of steel, Faggan Singh Kulaste, told India’s parliament on Wednesday, July 20.
The Steel Executive Association (SEA), representing senior executive officials in state-run companies under the ministry of steel recently submitted a proposal for the merger of RINL and SAIL along with mining company NMDC Limited, claiming that the merged entity would secure greater synergies and economies of scale of operations and at the same time the iron ore mines of SAIL and NMDC would offer raw material security to RINL, which does not have any captive source of raw materials.
The Indian government has already initiated the privatization of RINL, which operates a 7.3 million mt per year steel mill in the southern port town of Vishakhapatnam.