Andhra Pradesh government joins opposition to RINL privatization

Tuesday, 09 February 2021 11:45:25 (GMT+3)   |   Kolkata
       

Amid mounting opposition to the Indian government’s move to privatize state-run steel producer Rashtriya Ispat Nigam Limited (RINL), the state government of Andhra Pradesh, where the steel mill is located, has thrown its weight behind protestors seeking a reversal of the decision, a Andhra Pradesh government official said on Tuesday, February 9.

According to the official, Andhra Pradesh chief minister Jagan Mohan Reddy has written to the Indian prime minister, Narendra Modi, seeking a reversal of the 100 percent disinvestment of government equity to private investors, while affirming that the Andhra Pradesh government will work in collaboration with the central Ministry of Mines toward reviving the financial health of RINL.

In his communication, the chief minister said that, owing to unfavorable cycles in the global steel industry, RINL has been making losses since 2014-15 and is finding it difficult to service its debt liabilities. One of the major structural issues that also leads to the high cost of production is RINL’s lack of captive iron ore mines, affecting the operational viability and profitability of the company, the chief minister said.

Trade unions representing workers have formed a common platform opposing privatization and several state political parties have launched a sustained agitational program including blockades of roads and picketing of government institutions in the past several days.

Recently, India’s central Cabinet Committee of Economic Affairs (CCEA) approved the 100 percent strategic disinvestment of the central government’s shareholding in RINL along with management control in favor of private investors.


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