Steel ministry had sought finance ministry's clearance for sanction of revival package envisaging writing off about Rs 5,000 crore of the corporation's loan from the steel development fund (SDF) besides a number of other measures.

Steel secretary AK Basu, who was accompanying Ray, said that the finance ministry had sought certain clarifications in the earlier proposal. "Now we have to justify why we are seeking waiver of Rs 5,000 crore SDF loan," Basu said.

On the revival of Indian Iron and Steel Company (Iisco), whose revival package is pending Russian government's clearance, Sinha asked the steel ministry to get in touch with the Russian embassy.

The steel minister pressed the case of domestic steel companies, saying they should be given a chance to compete and supply steel to mega power projects rather than import it.

The finance minister had promised to examine the matter, Basu said.

The mega power projects were earlier allowed to import their total steel requirement at zero per cent import duty.

As many as 18 mega power projects in the country, with a capacity of 28,480 mw, have been allowed to import about 3 mt of steel.

Ray also referred to certain anomalies in the customs and excise duty left in the last budget, which Sinha promised to look into.

The proposed revival package for Vizag Steel Plant did not find favour with the finance ministry and a fresh proposal was being drafted, Basu said.Earlier, in a meeting with railway minister Mamata Banerjee, Ray requested her not to increase freight charges for steel and its raw material in the next railway budget 2000-01.

Banerjee promised to examine and rationalise freight charges for actual distance travelled rather than applying a minimum distance of 100 km.The railways were charging freight rates applicable to a minimum distance of 100 km even though the distance travelled was far less.