People's Democracy

IN a letter to the prime minister, written on January 17, D L Sachdev (AITUC), Tapan Sen (CITU) and R A Mittal (HMS) have drawn his attention to the government’s hectic move to sell out the premier public sector units (PSUs) of the country. This they said is being done in gross negligence of the national interests.

The recent decision of the Cabinet Committee on Disinvestment (CCD) reconfirms the fear. As reported in the press, the CCD decided to sell off the Jessop and Paradeep Phosphates Ltd. Financial restructuring and valuation process of Maruti Udyog has been completed for starting negotiations with prospective buyers.

The letter reminded the prime minister that the whole trade union movement in the country has recorded its opposition to the entire process that involves a compromise of national interests in favour of private buyers.

To facilitate the privatisation of PPL and to help the buyer as well, the government has decided to convert its loans into equity and take over the contingent liability of Rs 311.75 crore, which had been a matter of dispute between the PPL and the MMTC. Similarly, to facilitate the privatisation of Jessop, not only all loans and interest are being waived, purchase preference from railways will also be ensured for the company after privatisation, thereby guaranteeing a captive market to the private owner of the Jessop. But the same facilities have been consistently denied not only to Jessop but also to other wagon-manufacturing units like Braithwaite, Burn Standard, etc, which are also put in the queue for privatisation. The letter pointed out that the revival scheme sanctioned by BIFR for all these units could not be properly implemented owing to lack of orders from railways, which are to be guaranteed to the privatised entity. Had these facilities, like waiver of loans and interest and purchase preference from railways, etc, been assured for them, they could definitely revive on their own and contribute to the country’s exchequer.

This clearly shows that the ongoing privatisation exercise lacks even economic rationale, besides being detrimental to the interest of the industry and the economy. Thus the prospective buyers are the gainers in the process at the cost of national exchequer.

In view of the above, the letter urged the prime minister to review the whole process of privatisation. It reiterated the trade unions’ demand for a revival-oriented policy for the ailing PSUs, which will contribute more to the country’s economy than the illusory return from the ongoing distress sale of PSUs. (INN)