Bhubaneswar: With
the mines and metal sector going through a crisis period, banks have expressed
reluctance to provide more exposure to the sector. Even some banks have
expressed concerns about the fate of the existing advances to the sector.
“We have already overexposed to the steel and
mines sector and we do not want to increase it. Overall we have disbursed as
much as Rs.8000 crore to the steel and mines sector and a large chunk of it goes
to the units in the eastern India†said Mr. Bhaskar Sen, Chairman and Managing
Director of Kolkata headquartered United Bnak of India.
While the mining
sector is facing several clampdowns from the government, the steel and
aluminium sector is going through problems like raw-material crisis and several
regularity huddles. In Odisha the government has closed down more than hundred
mines after allegations of illegal mining. On the other hand Odisha’s steel
units are facing severe raw material crisis due to the closure of mines.
“The steel
industry in the state are facing acute raw material crisis due to negative
government policies in the last 3 years. Promoters who have come with very high
hopes have lost their investments, bankers have lost their investment†said
Mr.P.L.kandoi, President of the All Odisha Stele federation (AOSF).
The AOSF
represents as many as 200 steel units including more than 100 sponge iron
units,5-6 blast furnances and 50 upcoming integrated steel plants.
“The units have
taken bank loan ranging from Rs.20 crore to Rs.10,000 ÂÂÂÂÂÂÂÂcrore and with units are on the verge of
closure it is very difficult for them to repay.†Kandoi added.
Edited by Tapan Moharana
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