Wollongong Lord Mayor Gordon Bradbery is so concerned about the "urgency and gravity" of Gujarat NRE Coking Coal's financial troubles, he has postponed attending a statewide local government conference.
Cr Bradbery was due to attend the Local Government NSW annual conference on Tuesday, however he reorganised his schedule to focus on the "crisis" facing hundreds of Wollongong workers, who have not been paid for two weeks.
The company told miners at a union meeting held at the Fraternity Club on Monday they did not have the money to pay them for at least the next three weeks.
Cr Bradbery said the uncertainty over Gujarat's future undermined the confidence in the Illawarra economy, and would have an enormous "ripple effect" across the region.
"This affects not only the 450 workers who are not being paid, there are downstream implications of businesses, suppliers and tradespeople who are caught up in this as well.
"And at the present time, to lose 450 jobs makes a big hole in local spending and the local economy - so that means it's not only the direct jobs but the businesses where these people shop and their mortgages that will be affected."
Cr Bradbery said his office was "always open" to Jindal Steel and Power or any other investor that could help inject funds into Gujarat.
"I hope the negotiations for re-capitalisation are successful and that Jindal Steel and Power come on board," he said.
"Our city opened its arms to this company and would welcome a new investor.
"We are not closed for business and part of my brief as lord mayor is to welcome responsible investment in this city.
"I am also disappointed that our corporate regulators have not intervened sooner.
"This situation has been developing for a long time."
Meanwhile, Keira MP Ryan Park has urged banks to show compassion for Gujarat workers who may not be able to make mortgage payments.
Yesterday he wrote to the Australian Bankers Association asking that they show some leniency during the current takeover negotiations between Gujarat NRE and Jindal Steel.
"This is a very, very difficult time for the workers and their families," Mr Park said.
"We don't want families told that the bank is going to take their home simply because they may be behind in a payment as a result of their wages not being paid on time.
"Likewise, I think the banks can hold off on charging fees and costs associated with late payments as the workers go through this period of great uncertainty."