Date:29/05/2006 URL: http://www.thehindubusinessline.com/2006/05/29/stories/2006052903140300.htm

Back Panel pulls up SAIL for poor capacity utilisation

Our Bureau

`Rectify situation before next fiscal end'

New Delhi , May 28

The Parliamentary Standing Committee on Coal and Steel has pulled up SAIL for poor capacity utilisation at some of its integrated steel plants in 2005-06.

The committee has asked the company to rectify the situation before the end of the next fiscal.

The report comes as a surprise as SAIL claimed to have achieved 109 per cent capacity utilisation during the year. The report, however, states that higher capacity utilisation in some plants has enabled the company to achieve the overall target.

In its 17th report tabled in Parliament at the end of the Budget session, the committee has asked the company "to undertake a detailed performance audit of all SAIL units to pinpoint the weak links in their production process and take corrective steps before the next financial year."

According to the committee, the inefficient SAIL plants are piggybacking on the more efficient plants and that has enabled SAIL to show an overall full capacity utilisation.

"Except the Bhilai Steel Plant, the other units have failed to utilise either their capacity or achieve their target."

In view of the prevailing situation, the committee has stated that capacity utilisation at SAIL's Bokaro Steel Plant and Rourkela Steel Plant would remain low during the current fiscal too. "With regard to production of crude steel and saleable steel, whereas Bhilai Steel Plant will be producing at 120 per cent of its capacity, both Bokaro Steel Plant and Rourkela Steel Plant will be operating 80-90 per cent of their capacity utilisation." With regard to hot metal production for 2006-07, the report said that Bhilai Steel Plant has anticipated production of 4,900 tonnes against capacity of 4,080 tonnes.