Vedanta Alumina Ltd. (VAL) has announced its decision to close its Lanjigarh alumina refinery in Odisha from Wednesday, thanks to acute shortage of bauxite.

VAL said it could not find any solution to ensure sustainable supplies of bauxite for the refinery despite making concerted efforts in the last three months.

It added that the one million tonne per annum (mtpa) alumina refinery at Lanjigarh in the district of Kalahandi had been running at just around one-fifth of its capacity for the last few days.

Announcing its decision, VAL Chief Executive Mukesh Kumar said on Tuesday, "For the last three days, we have run the unit at around 20 per cent capacity and on December 5, we have been forced to close down the unit."

Mr. Kumar added that the company had been trying to source the raw material from Gujarat but upcoming elections in the State made it impossible for the company to come out with an open tender.

He further added that the already mined out bauxite in Odisha was being exported to other countries, Maharashtra was also suffering from scarcity of the raw material.

The closure of Lanjigarh refinery is expected to affect the livelihood of more than 6,500 people, of which 5,000 people were engaged indirectly with the plant while 550 are permanent employees of the plant.