Performing Cos must get Raw Material: says Naveen Jindal

ANGUL: The government should ensure that performing steel assets do not face any shortage of raw material, Jindal Steel and Power Ltd (JSPL) chairman Naveen Jindal said.

“You see only three private major steel companies have not embarrassed their investors, the rest have been pulled to the NCLT,”  Jindal said.

The government must give priority in providing raw material to those steel companies that are not facing insolvency proceedings and are regularly paying interest on debts, he replied to question related to the impact of rising prices of raw materials on his business.

Insolvent firms do not pay any interest, nor are they able to service their debt and such insolvent firms can even sell their items at lower rates, Jindal added.

“We are taking up this matter with the government that those companies which are giving the interest regularly must get uninterrupted supply of raw materials. I would say other ministries also, whether it is coal, railways, they must support them (performing companies) by meeting their requirement.

“If you don’t meet the requirement if there a shortage then government must supply raw materials on priority basis,” he added.

He further said that rise in iron prices is very unfortunate. They have gone up heavily in last two-three months and “(due to it) we have also raised rates. There wasn’t any other way by which this rise could have been evaded. We were bound to pass on the burden.”

The miners from whom the iron ore was being bought are citing the reason that because of court orders mines were closed and supplies were hit.

The prices of other materials like coking coal, electrode, coal and refractory are shooting up. “We have to service the debt also. We are bound to raise the rates,” Jindal said.

A company official said coking coal which was at $179 a tonne in the first week of November has reached $262 a tonne in international markets. There is also shortage of railway rakes, another company official said.

Supply and production of steel, aluminium, cement and captive power producers have been hit due to shortage of railway rakes and this situation needs immediate correction, Jindal said.