Selling VSP/RINL at this stage is like proverbial saying "Killing the Golden Goose", says P.V. Madhav, MLC and A.P. Legislative Council BJP Floor Leader
P.V. Madhav, MLC and A.P. Legislative Council BJP Floor Leader has made a fervent appeal to the Finance Minister, Nirmala Sitharaman, saying VSP/RINL has contributed about Rs. 43,099 crs to Central Govt and Rs. 8,565 Crs to State Govt exchequers till 2020, and with little support VSP / RINL, VSP/RINL and Steel giant as a whole shall be a Really Golden Goose for GoI. Senior intellectuals and Technocrats after detailed analysis are of the opinion that selling VSP/RINL at this stage is like proverbial saying “Killing the Golden Goose”. The letter written by P.V. Madhav to the Finance Minister is given below for the benefit of the viewers of www.indianpsu.com -
Smt Nirmala Sitharaman Garu,
Hon’ble Minister for Finance & Corporate Affairs, Government of India,
Sub: Mega Merger of NMDC,SAIL , KIOCL & RINL…. A strategic move for accelerated growth of Economy.Fillip towards achieving 300MTPA Steel capacity and 5 Trillion USD economy – Regarding.
Visakhapatnam Steel Plant initially envisaged with installed capacity of 3MTPA was commissioned in 1992, subsequently expanded to 6.3 MTPA and 7.3 MTPA without any budgetary support from GoI. It may be please be noted that RINL is disadvantageously positioned vis-à-vis its competitors those having captive mines for iron ore and coal, incurring an additional cost of Rs.5000/ per ton of production, translating into an additional expenditure of Rs.2000 to 2500 Crs per annum on Raw materials. In spite of many drawbacks and disadvantageously positioned, gave tough competition with Private players, huge profits till 2015, with its highly skilled man power and technological discipline.
GoI is planning to increase infrastructure spending for accelerated growth; Steel is back bone for infra spending. VSP/RINL is having a land bank of more than 20,000 plus acres and in the present environment, acquiring land has become a very tough task for Govt, and with availability of huge land bank, a Steel giant merging RINL,SAIL, NMDC & KIOCL shall be able to expand further steel capacities. This shall greatly help to realize the target of National Steel Policy of 300MTPA steel capacity by 2025. BJP Govt in the last four years made 4 mega mergers of Banks creating Banking giants, rationalized banking man power, increasing efficiency and increased services to people. A Steel giant on similar lines shall give competitive market for Steel and further investment in steel by private players. Privatization at this junction may in fact slower the addition of Steel capacities. Each of Steel units has its great strengths and weakness, merger of steel units help them to synergize their strengths and turn the weaknesses into opportunities.
Around 6,000 man employees are going to retire in VSP in next 5 years, thus reducing its manpower cost, further NMDC Nagarnar plant needs more than 800 experienced man power for running its plant. Both RINL & SAIL has got experienced man power that can be transferred to NMDC Nagarnar plant. NMDC and KIOCL have got iron ore mines and coal mines which RINL needs to reduce its production cost. A mega merger of these units shall be a big boost to economy.
“Viskha Ukku- Andhrula Hakku” one of the longest agitations post independence, in a decade long fight thousands of students lost their academic year, thousands lost their livelihood and 32 scarified lives.
Visakha Ukku is emotionally connected to combined Andhra Pradesh i.e Telugu people of both States. It is only biggest public sector in south India. It has brought metamorphic change in the development of entire backward 3 districts of North Andhra Pradesh, realized dream of GoI for bringing up living conditions of marginalized people from SC/ST/BC and Tribal of Andhra, Orissa and Bihar.
VSP/RINL has contributed about Rs. 43,099 crs to Central Govt and Rs 8565 Crs to State Govt exchequers till 2020, and with little support VSP / RINL, VSP/RINL and Steel giant as a whole shall be a Really Golden Goose for GoI. Senior intellectuals and Technocrats after detailed analysis are of the opinion that selling VSP/RINL at this stage is like proverbial saying “Killing the Golden Goose”. Especially privatization as this juncture shall worsen the living condition of more than lakh families who are already battered with onslaught of Covid.
Parallel growth of Public and Private steel capacities is only way to reach target of 300MTPA capacity, and 5 Trillion USD economy, but solely depending on Private players may be deterrent move, and become handicap of meeting Steel required for infra growth.
As a Legislative member representing from Andhra Pradesh and especially from a family deeply connected to people of north Andhra, I would like to convey the strong sentiments of people against privatization of VSP/RINL.
In view of the SWOT analysis of merger of RINL,NMDC,SAIL & KIOCL Vis-à- vis privatization of VSP/RINL, and strong sentiment of people who sacrifices their lives and properties, I would humbly request for consideration of the following -
1. Provide Rs 5000 crs preferential crs for immediate relief from impact of Covid affects
2. Provide Sovereign guarantee to raise unsecured loans
3. Merger of RINL, SAIL & NMDC in the first phase and then with KIOCLin the second phase
I request above proposals may please favourably be considered for over all development and also respect the sentiments of Telgu people.