“While on highways of growth, NALCO is yet to allot substantial part of its profit for CSR and peripheral development activities, matching the provisions drafted in the MMDR Bill, 2011. While the draft policy says that all mines will be asked to put in place corporate social responsibility schemes, setting aside 3% of their net profit of the previous year, NALCO has yet achieved to allocate only 2% in this regard. It’s to be noted that NALCO is closely involved in mining activities for its bauxite and alumina productions.”
It has reported that National Aluminium Company Limited (NALCO) has claimed a better growth in terms of dividend and diverse expansion. But the figures about CSR allocation and growth share seemed to be a clear mismatch of what the government of India has proposed in its Mines and Minerals (Development and Regulation) Bill 2011.
A Navratna PSU under Ministry of Mines, Government of India, NALCO has approved a total dividend payout of Rs.257.72 crore in the 31st Annual General Meeting. Since inception, NALCO has paid Rs.4197.72 crore as dividend, including Rs. 3659.60 crore as share of Govt. of India, told by the company in a press met held in Bhubnaeswar on August 14, 2012.
While addressing media after the Annual General Meeting, B.L. Bagra, CMD, NALCO said highlighting the growth plans of the company, “NALCO has adopted a new Corporate Plan, named Vision 2020. Pursuing the Vision Statement of becoming a ‘Reputed Global company in the Metals and Energy sectors’, the company has initiated actions, encompassing the whole gamut of business activities, for achieving the objectives set out in the Corporate Plan.”
Greenfield Projects
According to Bagra, NALCO has taken up different Greenfield projects in the country including a Rs.4,500 crore alumina refinery in Gujarat with one million tonne capacity for which the Detailed Project Report (DPR) is under work. The company is also planning a Rs.16,000 crore new smelter in Western Odisha which is being pursued with the State Government. The company also has plans to set up a 1.4 million tonnes per annum alumina refinery in Andhra Pradesh, based on bauxite reserves there. To start with, some CSR works have been undertaken in the vicinity.
Energy Sector
In energy sector, the company has formed a Joint Venture with Nuclear Power Corporation of India Ltd. to set up nuclear power plants in India. Both the partners have selected Kakrapar Units 3 and 4 of 700 MW each in Gujarat as their first JV project with an estimated project cost of Rs.11,500 crore. The construction work has already started and the project is scheduled to be commissioned by December, 2015.
Moreover, with a view to harness the unconventional energy source, NALCO is setting up a Rs.274 crore Wind Power Project in Andhra Pradesh with a capacity of 50.4 MW, which is in the final stage of commissioning. Plans are afoot for a second Wind Power Project of equal capacity. A third plant has been planned in the company’s own worked out mined area at Panchpatmali in Koraput district of Odisha. Also, a Solar Power Plant of 15MW is on the cards.
Brownfield Projects
With the commissioning of 4th Stream of Alumina Refinery during the year, the Rs.4402 crore 2nd Phase Expansion Project of the company stands completed. With the completion of this expansion programme, the annual capacity of the Bauxite Mines has increased to 63 lakh tonnes per annum, while that of the Alumina Refinery has gone up to 21 lakh tonnes per annum. Similarly, the capacity of the Aluminium Smelter has gone up to 4.6 lakh tonnes per annum and that of the Captive Power Plant to 1200 MW. The company has initiated activities for 3rd phase Brownfield expansion at the existing facilities in Odisha at an estimated investment of Rs.7,500 crore.
NALCO FOUNDATION
Besides periphery development works being undertaken through Rehabilitation and Periphery Development Advisory Committees (RPDACs) set up by the State Government, the company has set up a Foundation in 2010 for its CSR activities by allocating an additional one percent of its net profit every year, thereby doubling the CSR budget to 2% of the net profit. The Foundation has adopted project-based approach, ensuring community participation, accountability, sustainability and measurable results. Nalco Foundation is focused on development of villages located within 15 kms radius of NALCO’s Mines and Plants in Damanjodi and Angul, and also proposed mining areas such as Utkal-E Coal Block (Chhendipada in Angul), Pottangi (in Koraput) and Gudem & KR Konda (in Visakhapatnam and East Godavari districts of Andhra Pradesh).
Low on Profit Sharing and CSR allocation
While on highways of growth, NALCO is yet to allot substantial part of its profit for CSR and peripheral development activities, matching the provisions drafted in the MMDR Bill, 2011. While the draft policy says that all mines will be asked to put in place corporate social responsibility schemes, setting aside 3% of their net profit of the previous year, NALCO has yet achieved to allocate only 2% in this regard. It’s to be noted that NALCO is closely involved in mining activities for its bauxite and alumina productions.
The leading PSU is also to open how much of its profit is being shared for periphery and community development. As per 43 (2) (a) of the Draft Mines and Minerals (Development and Regulation) Bill, 2011, approved by Cabinet on 30th September 2011, in case of major minerals (except coal and lignite) Payment of compensation to owner of surface, usufruct and traditional rights, damage, etc. an amount equivalent to the royalty paid during the financial year has to be paid by the holder of a mining lease to the District Mineral Foundation.
NALCO should work on proper sharing of profit and more allocation for CSR activities as there have been reports of unfortunate and dangerous trends like prostitution for a good living coming up in Damanjodi, the place where the company has its mining site and bauxite plant.
( HOTnHIT NEWSFEATURES (HNF) (http://hotnhitnews.com/)
