POSCO’s Joint Venture Proposal with Visakhapatnam Steel Plant Maybe a Conspiracy to Privatise

Trade unions and Left parties are opposing the proposed joint venture of South Korean steel giant POSCO with Visakhapatnam Steel Plant (or Rashtriya Ispath Nigam Ltd. or RINL) to construct another steel plant in Visakhapatnam. Demanding the government to withdraw plans against privatisation, the steel plant’s workers will be holding a dharna in the national capital during the upcoming Budget session in February.

Reportedly, POSCO had submitted an investment proposal to Steel Secretary Binoy Kumar in July last year and had held three meetings with the officials of the biggest steel plant in Visakhapatnam.

Centre of Indian Trade Unions (CITU) state president, Ch Narasinga Rao, alleged that this is a larger conspiracy to privatise the steel plant and hand it over to POSCO. Speaking to NewsClick, Narasinga Rao said, “In a meeting with the plant’s officials, on November 9, 2019, Steel Minister Dharmendra Pradhan pressed for the joint venture with POSCO. However, in a separate meeting with the representatives of trade unions, the minister talked about the government’s plans of going for a joint venture but did not mention any concrete deal with the controversial POSCO.” He added that the project would only cause further loss to the public sector unit which might pave way for the central government’s disinvestment. 

At present, the steel plant has 11,474 employees, 6,132 officers and 16,000 contract workers.

Also read: Despite POSCO Struggle, Odisha Govt to Transfer Land to Jindal Group

Joined by trade unions, the workers have held several protest demonstrations in Visakhapatnam and in the state’s capital Amaravati. According to local media reports, the day when the steel minister visited the plant, workers formed a massive human chain stretching nearly 5 kms against the proposal. Subsequently, on November 13, 2019, about 1,500 workers took out a 400 kms motor bike rally to Amaravati to participate in a maha dharna. Opposition parties including all Left parties, Telugu Desam Party and Congress have expressed their support to the workers’ cause.

“It is a pre-planned scheme to hand over the steel plant’s land to POSCO,” Narasinga Rao told NewsClick. He alleged that after receiving “directions from Steel Ministry, the plant’s officials have already identified a land portion within the premises of the steel plant for the joint ventureand a new land policy was framed to lease out land for 30 years to any joint venture partner.”

Currently, Visakhapatnam's shore-based integrated steel plant has a capacity of 7.3 million tonnes and a land area of over 22,000 acres.

The workers there have led numerous movements against the disinvestment plans of the Narendra Modi government in the past six years.

It should be recalled that POSCO had to withdraw its plans after its failed attempt to start a 12 million tonnes steel plant in Odisha’s Jagatsinghpur. Despite a Memorandum of Understanding with the state government, the South Korean company had struggled to acquire land there amid strong protests by the farmers.