VISAKHAPATNAM: Even as the MPs from the state are agitating in Parliament and steelworkers are gearing up for ‘Chalo Parliament’ in protest against the steel plant privatisation plan, the Centre has reiterated its decision for 100 per cent strategic disinvestment of Rashtriya Ispat Nigam Ltd (RINL), the corporate entity of Visakhapatnam Steel Plant.
Minister of State for Finance Bhagawat Kishan Rao Kakad, in a written reply on disinvestment of RINL to TDP MP Kanakamedala Ravindra Kumar in the Rajya Sabha on Tuesday, said the Centre received communications from the State government requesting to reconsider the disinvestment plans of RINL after the decision was taken by the Cabinet Committee on Economic Affairs (CCEA) for the strategic disinvestment of RINL.
In response, the state government has been informed that the CCEA has accorded in principle approval for 100 per cent disinvestment of Government of India shareholding in RINL, along with RINL’s stake in its subsidiaries/joint ventures through strategic disinvestment by way of privatisation. The minister said with the approval of the Cabinet, a new Public Sector Enterprises (PSE) policy on Atma Nirbhar Bharat has been issued under which the existing CPSEs in the steel sector, which is a non-strategic sector, will be either privatised or closed.
He said the state government was further informed that the strategic disinvestment of Union government’s equity in RINL will lead to infusion of capital for optimum utilisation, expansion of capacity, infusion of technology and better management practices. This will result in higher production and productivity and expansion of direct and indirect employment opportunities. If the true potential of RINL is realised through these measures, it will lead to a much greater contribution to the growth of the economy of the State. While deciding the terms and conditions of the strategic sale, legitimate concerns of the existing employees and other stakeholders are suitably addressed through appropriate provisions made in the Share Purchase Agreement (SPA). It was also conveyed that in line with current practice on strategic disinvestment transactions, surplus land and other non-core assets in respect of RINL will be hived off so that they do not form part of disinvestment transactions.
The minister, in a written reply to MPs Subrat Pathak, Ravi Kishan and Sangam Lal Gupta on Monday, said disinvestment of the CPEs including the steel plants, at present, is guided by the new PSE policy forAtmanirbhar Bharat notified by the government on February 4, 2021 after approval by the Cabinet on January 27. As per the policy, existing PSEs have been broadly classified under strategic and non-strategic sectors. It has also been laid down that in strategic sectors bare minimum presence of the existing public sector enterprises at holding company level will be retained under the government control. The remaining enterprises in the strategic sector will be considered for privatisation or merger or subsidiarisation with another CPSE or for closure.
He said the PSEs in non-strategic sectors will be considered for privatisation, wherever feasible, otherwise such enterprises will be closed. The government has taken a decision for strategic disinvestment of steel plants and the ongoing disinvestment transactions in steel plants, including RINL, are in different stages, the minister said.
Strategic sale will help RINL, says Centre
New PSE policy: New Public Sector Enterprises policy on Atma Nirbhar Bharat has been issued under which the existing CPSEs in the steel sector, which is a non-strategic sector, will be either privatised or closed