VIJAYAWADA: The Andhra Pradesh High Court on Wednesday advised the Central government to reconsider its decision to privatise Visakhapatnam Steel Plant (VSP). The court also sought to know why the plant was being privatised, if it was making profits.Former IPS officer VV Lakshminarayana and one Suvarna Raju had filed petitions challenging the Centre’s move to privatise VSP.
Hearing the pleas, the division bench, comprising Chief Justice Prasant Kumar Mishra and Justice DVSS Somayajulu, sought to know whether the plant was running on losses and the amount of loss it had incurred in the past five years.
B Adinarayana Rao, the petitioners’ counsel, informed the court that lack of captive mines was resulting in losses to the steel plant. Stating that the Centre had not explained its reasons to privatise VSP, Rao said, “The Centre is of the opinion that some capitalists can run the plant.”
On the other hand, Advocate General S Sriram informed the court that VSP was currently running on sizeable profits and that Chief Minister YS Jagan Mohan Reddy had even written a letter to the Centre suggesting alternate measures for running the plant without privatising it.
Assistant Solicitor General N Harinath informed the court that the Centre had taken a decision to privatise the plant as it was continuously incurring losses. The bench observed that though various sectors were affected due to the Covid-19 pandemic, steel plants did not bear the brunt.
The unfavourable conditions to import steel from China was also a reason for the sector to thrive during the pandemic, the bench said and added that it would be improper to say that VSP will make profits now, if it could not during the pandemic.
The court posted the matter for further hearing on November 14. Meanwhile, the court also issued notices to the Centre to respond to petitions filed recently, seeking directions for implementing the assurance made earlier to provide employment to ration cardholders at the Steel Plant.
Further hearing on Nov 14
Asst Solicitor General informed the court that the Centre had taken a decision to privatise the plant as it was continuously incurring losses