AP govt permits conversion of RINL power dues to APEPDCL into share capital
As part of support of State govt towards RINL revival, they have consented proposal of Ministry of Steel for conversion of arrears
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Visakhapatnam: Andhra Pradesh Government has approved the conversion of dues to the tune of Rs2400 crore by Rashtriya Ispat Nigam Limited (RINL) to AP Eastern Power Distribution Company Limited (APEPDCL) into 7 per cent non-cumulative redeemable preferential share capital after 10 years.
Secretary, Industries & Commerce N Yuvaraj said in an order that as part of support of State Government on all fronts towards RINL revival, they have consented the proposal of Ministry of Steel for conversion of past arrears and upcoming dues of power charges of RINL to APEPDCL over the next two years, amounting to Rs2400crore (including Rs753.29 crore as charge due) into 7 per cent non-cumulative redeemable preferential share capital after 10 years, as a "State support measure towards the revival of RINL." In GO Ms. No. dated October 14, it was stated that RINL, the corporate entity of Visakhapatnaman Steel Plant, is a Schedule-A CPSE under the administrative control of Ministry of Steel which has a production capacity of 7.3 million tonnes per annum of liquid steel.
The main areas of activity of RINL are iron and steelmaking with finished products such as billets, wire rods, rebars, rounds, squares, channels, angles and pig iron. RINL is an unlisted company and the Government of India (GoI) holds 100 per cent of the shareholding. RINL started incurring losses since 2015-16 (except for the years 2018-19 and 2021-22 when it made nominal profits of Rs96.71 crore and Rs913.19 crore respectively.
The Secretary, Ministry of Steel had earlier informed that the support of the State Government would go a long way in helping RINL to tide over the crisis and requested to consider the extend the supporting order to help RINL sustain its operation till its revival as a going concern:
The Centre early this year had unveiled Rs11,440-crore revival package to prevent RINL from brink of closure.
Among others, deployment of State level security to RINL on free of cost basis, preferential purchase of steel from RINL for all projects of State Government, waiver of RINL’s power and water bills for a period of three years, were sought by the AP Government.
In response, the State Government informed the Secretary, Ministry of Steel, that the State Government will provide all the support for the efforts of the Ministry of Steel and RINL in reviving the company from its present status to a financially strong organization operating to its full installed capacity. Accordingly, all the requests of GoI and RINL have been passed-on to respective departments for their compliance, the GO stated.
Accordingly, the State Government approved for deployment of 167 APSPF police personnel RINL free of cost, w.e.f. 01.05.2025 with cost implication of its full installed capacity with cost implication of Rs19,72,02,432 towards recurring charges for one year and Rs7,02,432 for non-recurring charges, aspart of State support in the RINL revival package.
