View of NINL plant in Orissa's Kalinganagar.
The Union government on Wednesday gave ‘in principle’ approval for strategic disinvestment in Odisha-based Neelachal Ispat Nigam Limited (NINL) by selling equity shares of six public sector units (PSU) including two under the Odisha government.
A decision in this regard was taken by the Cabinet Committee on Economic Affairs (CCEA), headed by Prime Minister Narendra Modi. This is despite the bid to privatise the state-owned company was flayed by the employees in the recent past.
In a letter dated December 24 last year, the employees under the banner of Neelachal Banchao Militia Mancha had urged PM Narendra Modi, Union Steel Minister Dharmendra Pradhan and Union Commerce Minister Piyush Goyal to stop the privatisation of the company and had also opposed its merger with other steel making units of the government.
NINL, the largest producer of pig iron, is a state-owned joint venture company. Minerals and Metals Trading Corporation Ltd (MMTC), National Mineral Development Corp (NMDC), Metallurgical & Engineering Consultants (MECON) and Bharat Heavy Electricals Ltd (BHEL), along with Odisha government through the Industrial Promotion & Investment Corporation of Odisha (IPIOCL) and Odisha Mining Corporation Ltd. (OMC) hold stake in NINL.
On Wednesday, the Centre cleared the proposal of MMTC—the majority stakeholder with 49.78% in the company—and other minor shareholders to divest or sell off their equities.
According to the official statement, the strategic buyer for NINL will be identified through a two-stage auction procedure.
With the talks of NINL’s privatisation doing the rounds since June last year, tension struck the employees of the iron and steel plant at Odisha’s Kalinganagar. As a result, workers and villagers have been staging demonstrations opposing the move.
NINL is a 1.1 million tonne operating steel plant, with land of more than 2,500 acres under its ownership. It is the harbinger of prosperity to the area, said the employees in the letter mentioned above.
However, a financial crisis hovers around the company, as MMTC had stopped the infusion of working capital in the company, resulting in “blow down” of the blast furnace since last three months.
To this effect, the employees had demanded immediate infusion of working capital for commencing production.
The employees cried that they have been highlighting the issue faced by the company at various platforms and have been trying to engage with various authorities for their sympathetic consideration.
However, with decisions not getting materialised, salaries and wages to employees are not being paid and contractual employees are being laid off, as a result.
After Cabinet’s clearing the disinvestment proposal, NINL becomes the latest state-owned enterprise to get privatised under the BJP government. Other major PSU names include BPCL and CONCOR over which the spectre of privatisation looms.
To oppose this line of policy decisions, many government employees unions joined the general strike called by central trade unions on January 8.