The central government plans to announce another financial package to some extent $8,097 crore to the Rashtriya Ispat Nigam Limited (RINL), popularly known as the Visakhapatnam Steel Plant, as part of the revival of the financially stressed public sector project, people familiar with the matter said.
According to a senior official in the state government, who preferred to remain anonymous, the proposal $The infusion of Rs 8,097 crore will be in the form of equity. It is expected to provide immediate operational relief to RINL, which has been under severe financial pressure due to lack of captive coal mines, forcing the company to spend huge amounts on charging raw materials, including coal, iron ore and coke.
“The Union Finance Ministry approved the financial package last week, and it is expected to be officially announced after the ratification of the decision in the next Union Cabinet meeting,” the official said.
Senior union leader of Vizag Steel Plant VM Naidu confirmed the development. “We received the information two days ago. The financial package will breathe new life into the steel plant and will definitely help the company improve its production capacity in the coming days,” Naidu said.
Another union leader, J Ayodhya Ramu of the Center of Indian Trade Unions (CITU), said the matter came up for discussion during Union Minister for Steel HD Kumaraswamy’s visit, along with Minister of State for Steel Bhupatiraju Srinivasa Varma, to RINL on March 23.
“The Union Minister conducted a comprehensive review of the company’s performance and assured the Centre’s support for the revival and growth of the steel plant. He inspected key units including coke oven batteries, blast furnace 3, and wire rod mill and interacted with the employees to understand their problems,” Ramu said.
He pointed out that last year itself, trade unions asked the Center to announce a rescue package $ 20,000 Crores. “The latest package is part of the commitment made by the Centre,” the union leader said.
During the period 2024-25, RINL received temporary support $ 1,640 Crore, incl $500 Crores in shares and $ 1,140 crore as working capital loan. This assistance has enabled the second blast furnace to be restarted in October 2024.
Later, in January 2025, the government approved a comprehensive revival package worth $ 11,440 crores. This includes $10,300 crore in equity infusion and diversion $ Loan of Rs 1,140 crore to 7% redeemable non-cumulative preferred shares.
“In addition, the state government has supported the renaissance through transformation $ Rs 2,000 crore of power and water receivables in preference shares.
These combined actions helped stabilize operations, allowing the plant to restart all three blast furnaces — with the third operational in June 2025 — and increase production to approximately 93% of capacity,” said a state government official quoted above.
According to trade union leaders, RINL, which operates India’s only onshore integrated steel plant, currently has a production capacity of around 7-7.3 million tonnes, with the potential to expand by up to 17 million tonnes with new investments. It also owns a large area of land of 19,000 acres, including a green belt of 6,000 acres.
However, RINL still faces higher production costs compared to private and integrated steel producers, making it dependent on recurring government subsidies.
“For now, the Center has halted its original plan to privatize RINL due to strong pushback from employees and trade unions. But unless the Center assigns captive mines to RINL and reduces its dependence on imports, the company will have to continue to face financial pressure,” Ramu said.
