October 21 marked the eighth day of zero production at all the nine Hindustan Aeronautics Limited (HAL) units across the country. Nearly 20,000 workers of the public defence undertaking have been observing an indefinite strike over “discrimination” in the wage revision of executives and workmen.
The HAL management has responded by approaching the Karnataka High Court in Bengaluru where the company’s headquarters are based. “The management in its writ petition claims that a loss of Rs. 17 crore is being incurred everyday because of the strike,” Surya Devra Chandrashekhar, the Chief Convener of All India HAL Trade Unions Coordination Committee (AIHALTUCC), told NewsClick.
However, in what can be seen as a contradicting statement, HAL Chairman R Madhavan denied the loss claims. “Our day-to-day operations are continuing because one, the vendors are continuing to supply materials, our officers are working and test flights are continuing to take place,” Deccan Herald quoted him as saying.
Also read: 20,000 HAL Workmen Go on Indefinite Strike, Conciliation Meetings ‘Eyewash’
Loss or no loss, the HAL workmen are out on the streets demanding salary increments on par with the executives. The agitation has been met with apathy form the management which is not ready to bow down to their demands. What is strange, amid all this, is the silence maintained by the leadership of the Modi government, especially, the Ministry of Defence (MoD) and its Union Minister Rajnath Singh. Barring a few rumours, no efforts of the Modi government have come to the fore so far to resolve the deadlock in one of its ‘navratna’ public enterprise.
Following an aggressive disinvestment policy during PM Modi’s first term in office, it goes without saying that the public sector undertaking’s managements have been demoralised under the current ruling regime. The first 100 days of his second term didn’t change the script either. Most recently, under the ‘big-bang’ disinvestment process, government stakes in Bharat Petroleum Corporation Ltd (BPCL), North Eastern Electric Power Corporation Limited (NEEPCO), and Concor among others, are all up for grabs by private players. Other government owned firms such as BSNL, MTNL and Air India are also facing issues, with their staff being the first to bear the brunt of the Modi government's negligence.
Divest public companies for the benefits of the corporate patrons—the narrative has not left HAL untouched either. A source from HAL had earlier told NewsClick that the policies adopted by the Modi government has raised alarms within other public sector units as well. Though the financial position of HAL—as shown in its latest annual report—is stable enough, the management is of the opinion that it won’t be able to sustain the financial implications of the salary increments demanded by the workmen. This is a reflection of the eagerness of the Modi government in selling off public resources.
Also read: HAL Employees Plan Indefinite Strike, Allege Discrimination in Workmen’s Increments
The history of Modi government and the defence undertaking tells us that the apprehensions of the management are not unfounded. Soon after coming to power in 2014, it announced that it would no longer fund defence public sector units and that they must raise funds from the money market. A defence manufacturing company, conceived to serve the national security interests, was exposed to the vulnerabilities of the market economy, forcing it to become a profit-oriented unit. The result was that the PSU had to borrow Rs.1,000 crore earlier this year to pay salaries to its employees, an overdraft made for the first time in decades.
Meanwhile, the Modi government ensured the gradual disintegration of a cash-rich company which once had a profit of Rs. 11,699 crore, as pointed out by an earlier NewsClick article. The government forced HAL to increase payment of dividend to the government first, and then to buy 10% government shares in the company at an inflated price. Add to this, the mounting figures of payment that is yet to be cleared off by the Indian Air Force (IAF).
The consequence was the ill-intentioned narrative surrounding the financial viability of HAL which followed during the subsequent years. The company was robbed off the contract for manufacturing 108 Rafale jets. The defence budgets received cuts affecting orderbooks of the HAL. Though in September 2019, the defence unit was awarded a contract for 83 Light Combat Aircraft (LCA), according to The Print report, the state-run enterprise outsourced significant works to companies like Larsen and Toubro, and Alpha designs, boosting the Indian ‘private’ defence industry, needless to say, at the cost of the public undertaking.
Even though it was in the hotbed of TV debates earlier in the run up to the 2019 general elections, the real consequences of the deliberate sidelining of the HAL by the Modi government can be seen now, with the management looking keen to decrease the manpower costs and the workmen—not the executives—feeling the heat of it.
“No new workmen recruitments have been made after 2015-16,” Chandrashekhar told NewsClick, “and the only ones that have been made are tenure based.”
Also read: HAL Employees Accuse Govt of Conspiring to 'Bleed and Shut' Firm
NewsClick contacted HAL’s Human Resource Director Vinay Mohan Chamola, who said he is not authorised to speak on the questions related to the financial conditions of the company.
NewsClick also tried to speak with C B Ananthakrishnan, Director (Finance) & CFO, HAL, however, the calls were unanswered. The story will be updated if he responds.
Meanwhile, as the impasse between the management and the workmen continues, the Modi government’s silence speaks volume about where the government’s loyalties lie.