The Hindu Business Line : Steel PSUs will be divested, says national policy draft

DESPITE repeated assurances by the Union Steel Minister, Mr Ram Vilas Paswan, that public sector steel companies like Steel Authority of India Ltd (SAIL) and Rashtriya Ispat Nigam Limited (RINL) would not be disinvested, the `Draft National Steel Policy 2004' prepared by his Ministry clearly states that steel PSUs will be disinvested and a task force is to be set up for this purpose.

The draft policy, a copy of which is available with Business Line, categorically states: "Public sector undertakings in steel sector will be disinvested in due course of time. A task force shall be constituted to identify the PSUs to be considered for privatisation/disinvestment/dilution of Government ownership. The task force will also suggest strategies to expedite the disinvestments process for the units/facilities already identified for the purpose."

To make the divestment proposal somewhat palatable in the present political scenario where even the Prime Minister is not advocating disinvestment with much vigour, the policy paper goes on to add, "Notwithstanding the above mentioned objective, in the intervening period, the Government, on a case-to-case basis, shall continue supporting the existing PSUs for restructuring including manpower reduction and infusion of additional capital, if required, for achieving global scale operations through acquisitions, setting up of new green field plants and expansion of brown field capacity."

The policy draft also states that efforts will be made to rationalise the manpower of the PSUs by result-oriented voluntary retirement scheme packages and relocation to other productive areas.

It may be mentioned that this is the fourth draft national steel policy being circulated by the Ministry of Steel in the past four years since 2001.

However, in the earlier three occasions, the initial draft was found unacceptable by a substantial number of stakeholders in the steel sector as also sections within the Government following which fresh drafts had to be prepared.

As of now, comments from some of the related Ministries are expected shortly, sources said.