CHENNAI: Tamil Nadu government today again requested the Centre to drop the move to privatise the public sector Salem Steel Plant (SSP), saying the unit must be given a chance to make a turn-around.
"I believe the reasons for the SSPÂ’s recent losses must be studied...and it must be given a chance to improve its efficiency to make a turn-around,"Chief Minister K Palaniswami said in a letter to Prime Minister Narendra Modi.
The chief minister, who made a similar demand in April this year, said he was sure that SSP would transform once again into a profit-making enterprise if given the chance.
"I therefore request you once again to kindly intervene expeditiously and advise the Steel Ministry and the Steel Authority of India not to privatise SSP," he urged.
He pointed out that SSP's financial condition improved in the 2016-17 fiscal compared to 2015-16.
Further,the state government has supported SSP's Rs 2,005 crore expansion project, with a structured package of incentives in the form of soft loan, capital subsidy, electricity tax exemption and environmental protection subsidy, he said.
He said Public Sector Undertakings are capable of performing better when given the right support and direction.
Palaniswami recalled his request to Modi on April 26 this year to not privatise SSP and said the employees have apprised him that a legal advisor, asset valuer and transaction advisor were appointed by the Centre in June 2017.
The Chief Minister said he got to know that it has been decided to constitute an advisory committee to speed up SSP's privatisation by calling a global tender.
He said Salem Steel Plant over the years has acquired a global reputation for high quality steel and was an iconic symbol for Tamil Nadu and its people.
"We have a deep sense of pride and attachment to this public sector plant," Palaniswami said.
Recalling that government had acquired about 15.5. sq km land in nine villages four decades ago in Salem district for the plant, he said it was possible to undertake such extensive land acquisition in view of its public sector character.
"Further, the Salem Steel Plant provides employment to about 2,000 persons and many ancillary and subsidiary units also depend on it," he said.
Minister of State for Steel Vishnu Deo Sai had said the government accorded 'in-principle' approval for strategic disinvestment of three units of Steel Authority of India.
These were Visveswaraya Iron and Steel Plant(Karnataka), Salem Steel Plant, (Tamil Nadu) and Alloy Steel Plant, (West Bengal), "which have been consistently making losses," he said in reply to a question in the Lok Sabha on July 17 this year.
The process of "strategic disinvestment is to be carried out with the help of transaction adviser, legal adviser and asset valuer who would advise on appropriate mechanism of disinvestment, he had said.