By SNV Sudhir
Visakhapatnam, May 24, 2014: Disinvestment fear is looming
large over the thousands of workers of state owned, steel maker, Rashtriya
Ispat Nigam Ltd (RINL) here with the Modi led NDA, having the history of
privatizing many PSUs in its earlier stint, set to take reins of the union
government at Delhi.
Disinvestment was one of the success stories of the AB
Vajpayee led NDA government. The disinvestment proposals were halted by the
Congress led UPA government due to pressure from allies like the TMC and DMK.
It is said that the PMO had already prepared a list of PSUs, that need to be
disinvested.
In 2012 RINL which runs Visakhapatnam Steel Plant (VSP),
here had missed going for IPO thrice due to June 13 mishap, strong opposition
from work force and poor market conditions among other reasons. Last time
it was on October 16, 2012 that the RINL was supposed to be listed in the stock
exchange, which was deferred indefinitely.
Due to which it was at the verge of losing the Navaratna
status. However the status was extended twice till 2013 and then 2014. This year’s navartana status will also end in
the third week of November and it was compulsory to go for IPO to retain the
coveted tag.
RINL was awarded the Navratna status on November 16, 2010
with the condition that it would get its shares listed on the bourses within
two years
The Navratna status, is given to those PSUs who score a
composite score of 60 or above out of 100 based on its performance during the
last three years on six identified parameters. The Navaratna status empowers a
PSU to enjoy greater financial and functional autonomy.
“We fear that if not this year, the new government will go
for IPO. We have seen how resolute the NDA earlier on privatization and went
for disinvestment in many PSUs. We have also seen how disinvestment led to
government losing hold on the PSUs and private parties taking charge. One
classic example of Hindustan Zinc Ltd (HZL), in which Vedanta got high stakes
and subsequently it let to the closure of the Vziag unit. HZL staff held many
agitations opposing its closure but government could not do anything as the
private party had the majority control,” said AITUC general secretary, D
Aadinarayana, who led agitations against RINL IPO earlier.
There are around 14,000 permanent workers at VSP and around
15,000 contract workers. He added that,
the newly elected Vizag MP, Kambhampati
Haribabu had assured them that he would strive his best to protect the
interests of RINL. The VSP workers are now pinning hopes on Haribabu to stall
the IPO process otherwise to get ready for another round of stir to stop the
disinvestment.
RINL is in the advance stage of completing its expansion of
its production capacity from 3.2 million tonnes to 6.3 million tonnes at a cost
of Rs 12,500 crore. The RINL IPO was supposed to begin the UPA government’s Rs
30,000-crore divestment programme for 2012 fiscal. By diluting its 10 percent
stake in RINL, the government aimed to raise about Rs 2,500 crore.
The Cabinet Committee on Economic Affairs (CCEA) in January
2012 had approved disinvestment in RINL. The company has appointed four
merchant bankers - UBS Securities, Deutsche Bank, Edelweiss Capital and IDBI
Capital - as the book-running lead managers to manage the IPO process.
The entire workforce of VSP too observed total work shutdown
on October 12 and 13, last year opposing IPO.
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