RINL losing Rs 40-50 crore revenue a day amid ongoing strike at Adani’s Gangavaram Port
VISAKHAPATNAM : Rashtriya Ispat Nigam Ltd, (RINL), also known as Vizag Steel Plant, is incurring a revenue loss of Rs 40-50 crore per day due to workers’ protest at Adani’s Gangavaram Port in Andhra Pradesh, according to a letter written by the state-owned company to the Adani Group port firm.
“Due to non-availability of required coking coal, the company has been suffering a revenue loss of Rs 40-50 crore per day. Further, the health of equipment is endangered with prolonged shutdowns,” Atul Bhatt, Chairman and Managing Director, RINL, said in the letter dated May 5.
Heavy losses
The strike over wages, which started on April 12, has been choking the supply of coking coal, a key ingredient for steelmaking. Reportedly, Rs 700 crore worth of coking coal and limestone belonging to the steelmaker has been stuck at the Adani controlled port since the protest began.
“RINL has been writing to AGPL to make immediate arrangements for transfer of coal and limestone lying at AGPL yards… However, no response has been forthcoming from AGPL,” Bhatt wrote in his letter seeking immediate actions for the transportation of coal as mandated by the court.
The non-availability of required coking coal is posing a severe threat to the health of the equipment and financial health of the steelmaker, making it difficult to meet statutory payment obligations, Bhatt said in a letter sent to Vizag district collector, according to a statement from RINL.
According to reports, the Andhra Pradesh High Court has ordered AGPL to transport the coal to RINL through a conveyor belt system or any other immediate mode of transport.
“If this situation continues for another few days, total equipment worth more than 16,000 crore will be destroyed. The future of 30,000 employees is at stake now. AGPL has to take responsibility for all these losses,” said KVD Prasad, General secretary, Steel Executive Association.
The steel plant has five coke oven batteries and three blast furnaces. Of the three, only one furnace is operational due to the issue.
Why are the workers on strike?
The rift between the Adani Gangavaram Port management and the striking manual workers started amid demand for higher wages. The port had hired former fishermen as manual workers after they lost their land to the port following Adani’s acquisition in 2021.
Adani Ports and Special Economic Zone Ltd. (APSEZ) acquired a controlling stake of 58.1 percent in the Gangavaram port from the DVS Raju family for Rs 3,604 crore in March 2021. The acquisition and subsequent expansion of the port impacted the fishermen but some were transitioned to work as manual workers at the port.
According to reports, the workers are seeking higher pay and increased retirement benefits which the management has not agreed yet.
The port is strategically positioned to serve as a gateway to India’s east coast and the neighbouring countries in Southeast Asia. This location facilitates trade routes connecting India with key markets in Asia-Pacific, including China, Japan, South Korea, and ASEAN nations.