BRS, YSRCP lock horns over RINL barter deal
While BRS party having 51 per cent stake in SCCL is keen to take part in the exchange deal, AP govt has clarified that no State government enterprise or cooperatives can take part in bidding as per an order issued by GoI
image for illustrative purpose
- SCCL officials camped in Vizag to hold talks with RINL
- It has to arrange nearly Rs 5,000cr working capital
- SCCL has to supply iron ore and coal, in return, take steel produced from VSP
Visakhapatnam: Even as mercury is soaring all over Andhra Pradesh and Telangana, political temperatures in both the Telugu-speaking States are also rising with the Bharat Rashtra Samiti (BRS) and YSR Congress Party (YSRCP) deciding to lock horns over the Expression of Interest (EoI) issued by Rashtriya Ispat Nigam Limited (RINL) to seek proposals for working capital and raw material support in exchange of finished steel.
The fund-starved RINL, the corporate entity of Visakhapatnam Steel Plant, ran into financial distress following raw material insecurity for want of captive iron ore and coal mines, long gestation period for capacity augmentation and two-phase expansion from three to 6.3 million tonnes and later to 7.3 million tonnes with an investment of Rs 16,300 crore without support from the Government of India. RINL is unable to run all blast furnaces to achieve full capacity due to the present crisis.
The Department of Investment and Public Asset Management (DIPAM) under the Ministry of Finance is now working out transaction structure for strategic disinvestment of RINL, its subsidiaries and joint ventures following January, 2021 decision of Cabinet Committee on Economic Affairs for disinvestment of government shareholding by way of 100 per cent privatisation. The unions, who are on the warpath, are fighting for merger of RINL with SAIL to overcome working capital and raw material problems but the Ministry of Finance outrightly rejected it.
Though controversies are not new to VSP, which was set up after ‘Visakha Ukku Andhrula Hakku’ agitation and sacrifice of several lives, the latest row between the two ruling parties of Telugu-speaking States is with regard to March 27 notification issued by RINL to get a partner of mutual benefit. Visakha Ukku Parirakshana Porata Samiti, an umbrella organisation of rival trade unions welcomed the move by BRS Government in Telangana to take part in bidding for working capital and raw material support to RINL in exchange of finished steel rolled out from VSP through Singareni Collieries Company Ltd (SCCL).
SCCL officials are camping in Visakhapatnam to hold talks with RINL management to explore the option. But to emerge successful, SCCL has to arrange a working capital of nearly Rs 5,000 crore, supply iron ore and coal and take steel produced from VSP. In SCCL, a joint venture of Telangana and Central Governments, the former has 51 per cent equity. AP Industries Minister Gudivada Amarnath said no State Government enterprise or cooperatives can take part in bidding as per an order issued by the Government of India.
YSRCP leaders said BRS should clarify whether they are in favour of privatisation. YSRCP general secretary and Government Advisor (Public Affairs) Sajjala Ramakrishna Reddy said BRS is indulging in petty politics as it has failed to prevent privatisation in Telangana itself. BRS had earlier accused the Centre of planning to privatise Singareni mines after boycotting Prime Minister Narendra Modi’s recent visit to Hyderabad to flag off Vande Bharat train to Tirupati.
While the Left parties welcomed, VSP union leaders D Adinarayana and J Ayodharam hailed the BRS move, BJP State general secretary P V N Madhav alleged that BRS is desperately trying to have some foothold in Andhra Pradesh by raking up the VSP issue after indulging in ‘anti-Andhra rhetoric’ during Telangana agitation.
BRS working president and Telangana Industries Minister K T Rama Rao said they will go to any extent to prevent privatisation of RINL.
Incidentally, officials of RINL said the EoI sought by them is not meant for privatisation of the company. The notice is issued by RINL to seek partnership to overcome the present crisis whereas the privatisation issue is being handled by DIPAM, the officials claimed. The YSRCP Government has been batting for grant of captive mines and monetisation of surplus lands of RINL to meet the present and future requirements of VSP.
