Kalinganagar steel units urge to solve raw material shortfall

With the alleged multi-crore mining scam casting its shadow on the state owned Orissa Mining Corporation, the Kalinganagar Industries Association (KIA), representing 10 steel and ferroalloys units located in the Kalinga Nagar Industrial Complex (KNIC), today urged the state government to ensure steady supply of raw material to their units.

Non-supply of raw material will force them to close their units, the association warned the government.

The desperate attempt to seek raw-material supply follows the suspension of operations at OMC held Daitari mines in Keonjhar district and likely suspension of Kaliapani mines in next couple of days.

The industry body apprised the chief minister about the problem during his visit to the Kalinganagar industrial area on 16 December.

A delegation of KNIA led by its president Purushottam L Kandoi today met the industry secretary and other senior officials of the state government including the managing director of OMC in the state secretariat.

During the discussion, the industry representatives pointed out that the operations at Daitari mines have been suspended due to the absence of some clearances. Since the mines can’t be expected to resume production before six months, the Kalinganagar units would be forced to close their units. Such a situation is likely to create law and order problem in the area.

Stating that the steel and ferroalloys units in Kalinganagar area together have invested more than Rs 16,000 crore and employ over 30,000 persons, they urged the government to ensure raw-material linkage to their units at the earliest.

“The future of the Kalinganagar units is bleak unless the supply chain is restored by the government”, Kandoi told Business Standard.

Sources said, the association demanded that KNIC units must get 100 percent of their requirements from OMC. While OMC should increase its production, all closed mines especially for manganese ore should be re-opened.

While seeking long term raw material linkage through OMC or by the government, KNIA demanded that a joint venture with OMC may be allowed to ensure raw material availability to these units. OMC is the main supplier of the iron ore and the only supplier of chrome ore to these units.

Sources said, the industry secretary Saurabh Garg has asked the managing director of OMC to find out a solution to this problem. As a measure in that direction, KNIA would meet the managing director, OMC tomorrow to discuss about the vexed issue.