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Jagan govt adopts resolution against privatisation of Vizag steel plant
The Andhra Pradesh legislative assembly on Thursday unanimously passed a resolution opposing the central government’s proposal to privatise the Rashtriya Ispat Nigam Limited, also known as Visakhapatnam Steel Plant
The Andhra Pradesh legislative assembly on Thursday unanimously passed a resolution opposing the central government’s proposal to privatise the Rashtriya Ispat Nigam Limited, also known as Visakhapatnam Steel Plant.
The resolution was introduced by state minister for industries Mekapati Gautam Reddy during the one-day budget session in the assembly on Thursday. The resolution said it was opposing the decision of Cabinet Committee on Economic Affairs (CCEA) for 100% strategic disinvestment of the Government of India’s shareholding in the RINL, Visakhapatnam, along with management control by way of privatisation.
“The state cabinet deliberated on the issue at its meeting on February 23 and discussed the unrest among the trade unions and the general public of Visakhapatnam and decided to adopt a resolution in the assembly,” Reddy said.
The resolution was adopted unanimously with a voice vote in the assembly, before it was adjourned sine die. It also resolved to seek the support of Centre to make RINL profitable calling it the pride of “Telugu People” and the state of Andhra Pradesh.
The minister said the state government was supporting the cause of protecting the RINL from disinvestment, considering the sensitivity of the issue and widespread agitation by the trade unions and common public against the said proposal.
He reminded that chief minister YS Jagan Mohan Reddy had written a detailed letter to Prime Minister Narendra Modi on February 6, requesting to reconsider the proposal of disinvestment. “He (the CM) also suggested alternative solutions that might be helpful to address the issue of huge losses incurred by the RINL,” the minister added.
Explaining the history of RINL, the minister reminded that people of the state had rallied for the Visakhapatnam Steel Plant cause, in which 32 lives were lost. The plant was commissioned and started production in 1989-90.
Around 16,000 were employed as permanent and around 15,000 were employed as contact workers, thus creating huge employment for the people of Andhra Pradesh. Also, another 70,000 people were employed indirectly in various ancillary units.
He said the company incurred losses of ₹4,982 crore up to 2001-02. Capital restructuring was done by the Centre in 1993 and 1998 converting its loans of ₹1,384 crore into equity and ₹2,937 crore as preference share capital. Since then, it earned continuous profits for 13 years up to 2014-15 aggregating to ₹12,958 crore, the minister said.
He said RINL had achieved highest ever capacity utilisation of 6.3 million tonnes per annum against the installed capacity of 7.3 MTPA from December 2020 and started making a monthly profit of close to ₹200 crore. Continuing this performance for a further period of two years will help the financial situation immensely, the minister said.
Reddy said the state government had requested the Centre to allot captive iron ore mines in Odisha to the RINL to reduce input costs and restructure its finances by converting its high interest debt of ₹22,000 crore into equity.
“The Vizag steel plant stands as a testimony to the will of Telugu people and lives as an icon of Telugu achievement in our collective psyche. The government of the Andhra Pradesh is strongly against the privatisation of RINL and is ready to support the government of India, and ministry of steel to protect the jewel of the state,” Reddy added.
