A day after the central government announced a ₹11,440 crore financial package to bail out the debt-laden central public-sector undertaking Rashtriya Ispat Nigam Limited (RINL), or Visakhapatnam Steel Plant, mixed reactions have erupted among the trade unions and independent activists, who have been agitating for the last four years against the proposed privatisation of the steel plant.
The financial package was announced nearly four years after the Cabinet Committee on Economic Affairs (CCEA), which met on January 27, 2021, gave an in-principle approval for 100% strategic disinvestment of Government of India shareholding in the RINL along with management control by way of privatisation. On Friday, the Union Cabinet approved the ₹11,440 crore revival plan.
Ayodhya Ramu, a senior employee of the company and convenor of Visakha Ukku Parirakshana Samithi (committee to protect Vizag Steel), said the announcement of the financial package by the Centre was the victory of the trade unions and people of Visakhapatnam.
“But, there are still a lot of apprehensions among the workers of the steel plant. The Centre should withdraw, once and for all, its move for the privatisation of the RINL, against which we have been fighting for the last four years. For a permanent solution to all the present crisis in the Vizag steel plant, it should be merged with the Steel Authority of India (SAIL),” Ramu, who is also the honorary president of Centre for Indian Trade Unions (CITU) said.
Indian National Trade Union Congress (INTUC) general secretary Mantri Rajasekhar also welcomed the financial package, but said viability of the steel plant could be achieved only through other strong measures like allocating captive ore mines and merging the entity with the SAIL or National Mineral Development Corporation (NMDC).
Meanwhile, trade union leader Neerukonda Ramachandra Rao said the freshly-induced equity by the Centre was grossly insufficient, as most of the amount would be spent on settling dues to various vendors and employees.
On Saturday, Visakhapatnam-based retired IAS officer and former Union energy secretary EA Sarma, in a letter to Union finance minister Nirmala Sitaraman, said the latest Cabinet decision signalled a perceptible shift in the NDA government’s attitude towards privatisation of the RINL, in principle. However, he said the Cabinet had not been adequately apprised of the root causes of RINL financially becoming weak and the Centre is still unwilling to find a more viable approach to reviving RINL on a long-term basis.
“The package will not bring the RINL in a financially viable position and make it compete in domestic and overseas steel markets, unless it is in a position to secure ready access to good quality iron ore from a captive operational iron ore source of its own,” he said. Stating that the financial package is only a half-hearted step, Sarma said the most prudent way to revive RINL at this belated stage was to merge it with SAIL.
YSR Congress Party leader and former state industries minister Gudivada Amarnath said the Vizag steel plant, which has been operating under severe financial stress, requires sustainable solutions, and the package announced by the central government is insufficient to address its core issues.
Amarnath raised concerns over the financial package announced by the central government, stating that it falls short of expectations and clarity. “Why didn’t Prime Minister Narendra Modi make a formal announcement of the package during the latter’s public rally in Vizag last week? This shows lack of transparency in the Central government’s intentions,” he said. He accused the Centre of failing to withdraw its privatisation decision despite claiming to support the plant, leaving the employees and the public in confusion.
The YSRCP urged the Centre to abandon its privatisation plans and adopt a sustainable strategy to revive the steel plant,.
