New Delhi: A major proposal has emerged over the future structure of India’s public-sector steel industry. The Steel Executives Federation of India (SEFI) has urged Prime Minister Narendra Modi to bring SAIL, Rashtriya Ispat Nigam Ltd (RINL), NMDC Steel’s Nagarnar plant and MECON Ltd under a single mega public-sector steel company.
SEFI, which represents around 20,000 officers working in steel PSUs, has argued that integrating these companies could help the government expand steel production capacity while protecting jobs and making better use of existing public-sector assets. The federation submitted its demand to the Prime Minister in a letter dated August 31, 2026, signed by SEFI Chairman Narendra Kumar Banchhor. The proposal was subsequently reaffirmed through a resolution at the federation’s council meeting in New Delhi.
Why does SEFI want these steel PSUs merged?
At the heart of SEFI’s argument is what it describes as a mismatch in the government’s current approach to public-sector steel companies. According to the federation, SAIL has been asked to increase its steelmaking capacity to 35 million tonnes (MT) by 2030. The expansion is expected to require an investment of more than ₹1 lakh crore.
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At the same time, RINL has a capacity of 7.3 MT, while NMDC Steel’s Nagarnar plant has a capacity of 3 MT. SEFI says these two assets are being considered for disinvestment. The federation believes that instead of expanding one PSU while moving toward the sale of other government-owned steel assets, SAIL should acquire and integrate them.
SAIL could reach its capacity target faster
SEFI has proposed that the funds already earmarked for SAIL’s expansion could be used to acquire RINL and the Nagarnar plant. The federation’s argument is that such a strategy could allow SAIL to move toward its 35 MT capacity target without waiting for the construction of entirely new facilities. SEFI says the approach could potentially save time, financial resources and administrative effort, while also making use of steelmaking capacity that is already available.
Employment protection is another key argument
The proposed integration is not only about production capacity. SEFI has also highlighted employment. According to the federation, bringing RINL and Nagarnar under a larger SAIL-led structure could help protect the direct and indirect employment associated with these facilities. The proposal could therefore have implications for thousands of workers and their associated economic ecosystems.
Nagarnar plant could boost Bastar’s development
SEFI has particularly highlighted the importance of the Nagarnar Steel Plant in Bastar district. The federation believes that keeping the plant within a large public-sector steel structure could provide a fresh push to social, economic and infrastructure development in Bastar. The argument effectively links the future of Nagarnar not only to steel production but also to employment and regional development.
SEFI also wants steel to be declared a strategic sector
The merger proposal is not SEFI’s only demand. The federation’s council has also reiterated its call for steel to be classified as a Strategic Sector.
SEFI argues that steel is a critical component of India’s economic growth and makes a substantial contribution to GDP. On this basis, it wants the steel industry to continue receiving strategic importance within the government’s policy framework.
Demand was first raised in 2021
SEFI says the demand to declare steel a strategic sector is not new. The federation had originally passed a resolution on the issue in April 2021.
Since then, the organisation says it has made several representations to the government seeking consideration of its proposals. The latest council resolution indicates that the federation intends to continue pressing for both the proposed PSU consolidation and strategic-sector status for steel.
Steel PSU representatives attended the Delhi meeting
Representatives of officers’ associations from SAIL plants across the country, RINL’s Visakhapatnam Steel Plant (VSP), MECON and Nagarnar participated in the federation’s council meeting in New Delhi. The meeting was held at the SCOPE Minar complex and provided a platform for representatives associated with different government-owned steel entities to discuss the future of the sector.
What could a mega steel PSU mean for India?
If the proposal is considered by the government, it could lead to a significant restructuring of India’s public-sector steel industry. A combined entity involving SAIL, RINL, Nagarnar and MECON could potentially create a larger integrated government-owned steel ecosystem, combining production capacity, engineering capabilities and existing infrastructure. However, SEFI’s proposal is currently a demand from the officers’ federation. Any merger, acquisition or change in the status of these PSUs would depend on decisions and approvals by the government.
SEFI’s key demands at a glance
- Merge SAIL, RINL, Nagarnar Steel Plant and MECON into one mega PSU.
- Use the budget already earmarked for SAIL’s expansion for the proposed acquisitions.
- Protect direct and indirect employment associated with RINL and Nagarnar.
- Use the Nagarnar plant to support development in Bastar.
- Declare steel a Strategic Sector.
- Make better use of existing government-owned steel capacity.
Bottom Line: SEFI’s proposal seeks a major rethink of India’s public-sector steel strategy. While SAIL is being prepared for a major capacity expansion, the federation believes that integrating RINL and Nagarnar into SAIL could offer a faster and potentially more resource-efficient route to expanding India’s government-owned steel capacity.