Bayyaram steel plant hangs in balance

Hyderabad: The fate of the steel plant that was proposed for Telangana State under the 13th Schedule of the AP State Reorganisation Act hangs in balance.

While the Steel Authority of India Limited (SAIL) is disinclined to take up the project in Khammam district on the grounds that the iron ore available in the mineral rich Bayyaram area is of inferior quality a few mining companies in collusion with ‘influential’ political leaders were said to be exploiting the ore illegally and were putting pressure on the government not to push the project ahead.

An official of the State Industries Department explained to The Hans India that the SAIL did not take any steps towards establishing the steel plant. The steel plant issue had assumed greater importance during the struggle for separate statehood for Telangana. TRS president K Chandrashekar Rao fought tooth and nail against the Congress government on leasing out Bayyaram iron ore mines to a joint venture of the AP Minerals Development Corporation Ltd (APMDCL).

Bayyaram reflects the Telangana identity and that the ore available there was of high quality, he had said then. The ore at that time was leased out to Rakshana Steels promoted by Anil Kumar, son-in-law of former chief minister YS Rajasekhara Reddy. The government then, in its orders issued on February 24, 2009, had directed the APMDCL to supply iron ore from the deposits available in Bayyaram, Garla and Nelakondapally in Khammam district and Guduru in the neighbouring Warangal district to the project apart from being a joint venture partner.

But in June 2012, the government led by N Kiran Kumar Reddy cancelled the lease on the grounds that YSR and Rosaiah governments had circumvented the Land Transfer Regulation Act 1959 and the Mines and Mineral Development and Regulation Act 1957. These two Acts prevent non-tribals from conducting mining activities in the tribal areas.

To bypass the clauses guaranteed in these two Acts, the state government issued GO No 64 on June 30, 2010, by which it handed over 56,690 hectares (1.4 lakh acres) in Khammam district for 10 years to APMDCL which in turn transferred the land to a joint venture of APMDCL and Rakshana Steels by which the land finally landed with the private company.

After bifurcation of the State, the Centre promised that the SAIL would set up a steel plant. But 15 months down the line, the SAIL has not done anything to take it forward, according to State Industries Secretary Arvind Kumar. The main objection raised by the SAIL to initiate the process for the setting up the plant was the inferior quality of the ore.

The SAIL does not agree with the report submitted by the state government which claimed that the mining area contains 60 per cent ferrous which is required to set up a steel plant, according to a top source.

Following this, the state government has now requested the Geological Survey of India (GSI) to conduct a survey and prepare a report on the quality of ore in the mining area. Clarity on the quality of ore will come out only after GSI submits its report. The report is likely to be ready in six months time, according to Deputy Secretary to Industries V Saida. He said the state government proposes to negotiate with private companies, including Jindal Steels in case SAIL does not agree to set up the plant.

By:Patan Afzal Babu