The government of the southern Indian state of Tamil Nadu will oppose the Indian federal government’s plans to sell Salem Steel Plant (SSP), a wholly-owned subsidiary of Indian government-owned steel company Steel Authority of India Limited (SAIL), a Tamil Nadu government official said.
The official said that, since SSP was located in the state, the selling of the special steel manufacturing plant as approved by the Indian government would have a “deleterious impact on employment” as well as on ancillary and peripheral economic activities in Tamil Nadu.
The Tamil Nadu government could consider making an offer to pick up an equity stake in SSP as a counter proposal to the selling of the plant to a private investor, he said, but refused to give details as any such proposal would first have to be approved by the Tamil Nadu government.
However, he cited the case of Indian lignite miner NLC Limited (formerly Neyveli Lignite Corporation Limited), in which the Tamil Nadu government a few years ago had picked up an equity stake and thereby avoided a similar sell-off plan of the Indian government for the coal miner with operations in Tamil Nadu.
The Indian government has already given approval for the sale of SSP and SAIL is in the process of appointing financial advisors for the proposed transactions.