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TBA Exclusive: How Vizag Steel Plant Privatisation may hit livelihoods of people in AP

Ever since the Finance Minister announced in Budget 2021 that Visakhapatnam Steel Plant would be privatised, every section of Andhra Pradesh including labour unions, political parties, employees and people have been opposing this move of the Centre. 
 
The Visakhapatnam Steel Plant (VSP) falls under the Rashtriya Ispat Nigam Limited (RINL), a PSU of the Government of India. Nearly 45,000 families derive their livelihood from the PSU and it offers indirect employment to around 1 lakh people in the state. 
 
On the whole, nearly 5 lakh people are dependent on the VSP. That’s equal to a quarter of the population of Vizag city. Given the massive employment and ancillary business the Vizag Steel Plant creates, the opposition against privatisation is growing everyday. 
 
Another strong reason for Andhra Pradesh to fight for the Steel Plant is a promise of the Centre to expand it as part of the bifurcation promise. As part of its promises to Andhra Pradesh, the Centre said the expansion of Vizag Steel Plant with an outlay of Rs 38,500 crore will benefit the state. Unfortunately, the detailed project report (DPR) for this expansion had to be submitted by January 2018. 
 
In the meantime, a change in ruling government in the state also led to a lot of haphazard decisions which not only led to investments leaving the state but also now losing out on Krishnapatnam Port to private players like Adani, followed by Steel Plant’s privatisation. 
 
The steel plant’s privatisation, sources say, is apparently the Centre tactic to give it private Steel Giant POSCO which already has been operating in Odisha. Additionally, The Centre wants to privatise because the Plant has been in losses. What this has done over the years is despite the plant's capacity being 21 million tonnes per year, it is operating with a production capacity of only 7.3 million tonnes currently. 
 
The reason for losses of the plant is lack of raw material. Like SAIL, Tata Steel, Jindal Steel and other steel plants, the VSP does not have its captive iron ore mine. So, if the Central government allocates captive iron ore mines to VSP, they can bring back the profits to it and run it on full capacity, without privatisation. 
 
Therefore, the Centre should support the Steel Plant & workers' unions along with their livelihoods and stop the privatisation of VSP. It will not only save livelihoods of people depending on the Vizag Steel Plant but also save the state from financial crisis that eventually affects every citizen of Andhra Pradesh. 

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