Tuesday, November 5, 2024

Deep crisis engulfs VSP as Centre, State remain inert

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The port workers’ strike has precipitated a complete cessation in the supply chain of vital raw materials like coal and limestone to the steel plant. Despite securing a hefty loan of Rs 600 crore to procure coking coal from Australia and the USA, the steel plant’s owner finds the consignment marooned at the port’s premises. Although Adani ostensibly signals readiness to expedite the coal transfer to mitigate further harm to the plant, negotiations are at an impasse as both sides exploit the strike to their advantage.
PNS n Visakhapatnam

The Visakhapatnam Steel Plant (VSP) is currently facing a profound crisis, aggravated by the apparent inaction of both central and state governments in addressing the ongoing turmoil. Initiated by expatriate workers at Adani Gangavaram Port on April 12, the strike has persisted for more than a month, significantly disrupting the plant’s operations and economic viability.
The port workers’ strike has precipitated a complete cessation in the supply chain of vital raw materials like coal and limestone to the steel plant. Despite securing a hefty loan of Rs 600 crore to procure coking coal from Australia and the USA, the steel plant’s owner finds the consignment marooned at the port’s premises. Although Adani ostensibly signals readiness to expedite the coal transfer to mitigate further harm to the plant, negotiations are at an impasse as both sides exploit the strike to their advantage.
Amid the chaos, the Steel Officers Association remains indifferent to interim directives from the High Court, while labour unions vehemently accuse vested interests of orchestrating a deliberate prolongation of the crisis to thrust the steel plant into financial ruin. Despite workers’ efforts to instigate dialogue involving the district collector and police commissioner, these endeavours prove fruitless, with port management displaying a conspicuous lack of initiative. Moreover, the distraction posed by election duties has relegated the issue to the backburner for district officials, even as work pressures have abated.
The strike’s repercussions reverberate through the steel plant’s production line, culminating in a catastrophic downturn. Typically churning out goods worth Rs 2,500 crore monthly and 20,000 tons of steel daily, the plant managed a paltry Rs 1,250 crore in steel production for April. By mid-May, production plummeted further, with only 70,000 tons manufactured, valued at Rs 370 crore against an anticipated Rs 1,000 crore.
The financial tumult is palpable as the steel plant grapples with meeting its financial commitments. April’s employee salaries, amounting to Rs 84 crore monthly, remain outstanding, with partial disbursements made the preceding month.
As of May 15, employees are yet to receive any compensation. Compounding the predicament, the Eastern Region Electricity Distribution Company issues a stern notice demanding Rs 68.43 crore for March’s electricity dues, threatening to sever the supply if unpaid within two days.
In light of the mounting crisis, labour and job unions fervently appeal for the immediate appointment of a district collector and police commissioner to broker dialogue with the striking workers and facilitate the resumption of coal and limestone supply to the beleaguered steel plant. Absent prompt intervention, the Visakhapatnam Steel Plant teeters on the brink of escalating losses and operational paralysis.

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