Letter by Shri EAS Sarma, Former Secretary to the Government of India,
Visakhapatnam to Union Ministers of Mines, Steel and Port & Shipping
The NMDC has been forced to divert iron ore exports from Visakhapatnam Port, a public sector unit (PSU), to Adani-promoted Gangavaram Port. The ArcelorMittal Group has been given permission to set up a major steel plant a few kilometers away from Visakhapatnam Steel Plant, (VSP), another PSU, along with a captive port and a captive iron ore mine. This has been done while the VSP’s demand of the allotment of a captive iron ore mine has not been met for decades. Over 1,167 acres of land of the VSP had earlier been allotted to the Adani-owned Gangavaram port. From the above actions it is clear that a systematic plan has been launched to cripple both the PSUs at the Vishakhapatnam for the benefit of monopoly capitalists interested in port and steel sector with to ultimately privatise them.
To
Shri G Kishen Reddy
Union Mines Minister
Shri H D Kumaraswamy
Union Steel Minister
Shri Sarbananda Sonowal
Union Shipping & Ports Minister
Dear S/Shri Reddyji, Kumaraswamyji and Sonowalji,
I refer to my earlier letter of March 4, 2026 (https://countercurrents.org/2026/03/nmdc-forced-tosign-an-mou-with-adani-groups-gangavaram-port-to-set-up-iron-ore-processing-facilities-for-itsexport-hurts-the-interests-of-two-cpses-visakhapatnam-port-and-visakhap/) in which I had pointed out the adverse implications of NMDC shifting its iron ore export activity from Visakhapatnam Port, only to benefit the Adani-promoted Gangavaram Port by entering into a tripartite agreement with Vale S.A. (Brazil). The agreement envisages development of an integrated facility for blending and commercialisation of iron ore and establishment of fully mechanised berthing and cargohandling facilities capable of accommodating Valemax vessel with a carrying capacity of up to 400,000 MMT.
I wish to remind you that NMDC has a long-standing partnership with VPT for exporting high-grade iron ore from its Bailadila mines in Chhattisgarh. VPT operates a state-of-the-art mechanized facility capable of loading iron ore at 8,000 tonnes per hour. It can accommodate large vessels up to 200,000 DWT. The ore handling facility includes wagon tipplers (2,700–3,000 TPH), three bucket wheel reclaimers (4,000 TPH capacity), and a 9.5 km conveyor system that connects stockyards directly to the port.
Are those at the helm of power at the Centre aware that all those facilities at the VSP would become infructuous as a result of the undue haste in which NDMC has been forced to join hands with the Adani Group?
The above cited arrangement simultaneously runs counter to the interests of two major CPSEs near Visakhapatnam, namely, Visakhapatnam Port Trust (VPT) and Visakhapatnam Steel Plant (VSP), with which the people of north Andhra Pradesh have a sentimental link, as they been at the centre of all round development of the region.
The Union Ministry of Steel, joining hands with the State government, has already caused a major setback to both VPT and VSP, by according clearances on a war-footing to ArcelorMittal Group to set up a major steel plant near Anakapalle, a few kilometers away from VSP, along with a captive port and a captive iron ore mine. As a result of that imprudent decision, the interests of both VSP and VPT would suffer.
Had the Centre allotted a captive iron ore mine for VSP, it would have helped the CPSE to trim its raw material purchase cost and earned sufficient profits to emerge as a major player in the steel sector.
Evidently, the decision not to allot a captive iron ore mine to VSP is a part of a covert attempt on the part of the Centre to deliberately weaken VSP, so that its invaluable assets, including land, machinery and human talent could be handed over for a pittance to a chosen private party. Indirectly, it appears that it is also a part of a well-orchestrated plan to benefit the Adani Group.
In the past, under pressure from the then State government, the Centre had allotted more than 1,800 acres of VSP’s land at an abysmally low price to the private promoters of Gangavaram Port, which the latter under duress had to hand over to the Adani Group. I understand from a local news report (https://www.andhrajyothy.com/2026/andhra-pradesh/adani-iron-ore-blending-plant-takes-over-steel-plant-land-near-gangavaram-port-1505910.html) that the Adani Group is now trying to get hold of another stretch of 1,167 acres on lease, as a part of the tripartite arrangement cited above, in the name of setting up an iron ore pellatisation plant, from the land originally acquired for VSP, .
It is illegal to alienate the lands acquired for a CPSE under the erstwhile land acquisition legislation of 1894 to a private agency, as under that legislation, the term “public purpose” is defined in Section 3(f)(iv) as for a company wholly owned/ controlled by the government. Therefore, the Centre’s decision to hand over a portion of the land acquired for VSP to the privately-owned Gangavaram Port, either in the past or now would be illegal. Such a land alienation in favour of the Adani Group would therefore be patently invalid. I hope the government will appreciate the legal implications and desist from it.
I may also point out that the very idea of exporting iron ore, instead of adding value to it by getting it processed in domestic steel plants, is highly imprudent. In the long run, India would lose by exporting iron ore and importing finished steel products. Why should NMDC be forced to export iron ore to Brazil?
In that connection, we should keep in view how China is aggressively importing iron ore and stockpiling it (https://www.reuters.com/markets/commodities/chinas-robust-iron-ore-imports-are-going-into-storage-not-steel-2026-03-19/)
Against the above background, may I appeal to you to revisit the policy of NMDC exporting iron ore in the first instance and, pending such as review, not to do anything that hurt the interests of VPT and VSP.
Regards,
Yours sincerely,
E A S Sarma
Former Secretary to the Government of India
Visakhapatnam