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SAIL retires Rs 2,600-cr high-cost debt

Our Bureau

NEW DELHI, July 17

IN a major debt restructuring initiative, the Steel Authority of India (SAIL) has repaid high cost debt totaling over Rs 2,600 crore during the past 15 months. This has helped the company bring its market borrowings to a level of under Rs 14,200 crore at the end of June this year.

SAIL had a peak debt burden of over Rs 21,000 crore in April 1999. Since then the Government had put into effect a major financial and business restructuring plan for the company.

During 2000-01, SAIL effected debt repayments of Rs 2,100 crore. An additional Rs 535 crore were paid during the first quarter of the current financial year. Most of this was high cost debt, bearing interest rates between 15 and 17 per cent.

The company had borrowed heavily during the mid-eighties to fund its massive modernisation progamme. Thereafter, better operational efficiencies and tight fiscal management resulted in the raising of internal resources which were used for debt retirement .