Nearly 50,000 Chhattisgarh steel workers face job loss

RAIPUR - About 50,000 workers employed with 175 mini steel plants in Chhattisgarh face a threat of job loss as factory owners have announced closure of their units in the wake of rising prices of sponge iron used as raw material.

“The per tonne price of sponge iron has shot up from Rs.14,000-15,000 to Rs.18,000 and it is not even available as per our needs…we have no option but to start closing the units from December 1,” Ashok Surana, president of the Chhattisgarh Mini Steel Plants Association, told IANS.

The association represents 175 small units with about 50,000 people employed in all ranks. The mini steel units use sponge iron, heavy melting scrap and pig iron as raw material for producing ingots and billets.

Surana said that mini steel plant owners have sought a bail-out package from the state government and approached Chief Minister Raman Singh to help the association members get over the crisis but his response was “extremely cool”.

“We are going through one of the worst phases and need a little bit support from the government but since the government is not ready to step in the matter, we have no option but to shut down units…it will directly hit the 50,000 workers employed with the 175 units,” Surana said.

The 175 mini steel plants have a combined monthly output of 350,000 tonnes. Chhattisgarh contributes 27 percent of India’s total steel production.

Experts say that if the plants stick to their closure announcement, it would severely hit 76 sponge iron units in the state as well, whose monthly output also is around 350,000 tonnes.