Union Cabinet approves merger of Sponge Iron with NMDC

sponge iron india ltd

The Indian government has finally approved the merger of unlisted state-run firm Sponge Iron India Limited (SIIL) with National Mineral Development Corporation (NMDC).

The proposal for merger of the two public sector enterprises under the Ministry of Steel was approved by the Union Cabinet at its meeting.
The merger will be carried out within six months through acquisition of SIIL shares by NMDC in the public interest.

Further, NMDC will implement the proposed sponge iron plant expansion project at Paloncha in Khamman district of Andhra Pradesh. Along with this, the company will also ensure the in-house supply of raw material to SIIL’s plant by utilizing the latter’s surplus land, manpower and financial resources available with NMDC.

SIIL is an enterprise with the Centre owning 97.44 per cent while the remaining was held by the State Government. The company has been facing acute raw material shortage for the last couple of years. It has an installed capacity to manufacture 60,000 tons of sponge iron per annum.
The Government had earlier proposed the merger of SIIL with the Vizag Steel Plant, but it did not happen.