Visakhapatnam Steel Plant going Selam and Vijayanagar way

Hyderabad: Has highhandedness and excessive political interference impacted the sustainable business parameters of the Visakhapatnam Steel Plant (VSP)?

It seems that all the three steel plants in the South – VSP (in AP), Vijayanagar steel plant in Karnataka (which has already gone into the hands of JSW) and Selam (in Tamil Nadu) which were established following sacrifices made by the people -- are now for sale!

"Setting up the Visakha Steel Plant reflects the visionary leadership of the second Prime Minister of the country Lal Bahadur Shastri who assured to give a first shore-based and port-led steel plant," Viswanatham (name changed), a key official in the operations wing of the VSP, told Hans India, echoing the views of the time on the plant.

In fact, the same views were expressed by then chief minister of Andhra Pradesh Dr M Chenna Reddy during his budget speech for the financial year 1966-67 in the Andhra Pradesh Legislature Assembly on February 21. He had stated that the state government had been demanding that the fifth steel plant in the public sector should be set up at Visakhapatnam and hoped that the Government of India would do so.

K Dakshina Murthy, a VSP retired employee, said that what followed was the resistance of the Congress government at the Centre led by former PM Indira Gandhi which gave birth to the 'Ukku' agitation in which 32 people lost lives. The Congress government was finally forced to announce three steel plants in the fourth five-year plan which included VSP. The other two plants were to be set up at Salem and Vijayanagar in Karnataka.

While the Vijayanagar unit has gone into private hands, the Steel Authority of India now wants to give up its share in the Selam steel plant. The VSP too is on the disinvestment list. Thus, "all three steel plants set up in South India following several sacrifices made by the people for creation of job opportunities are now for sale.

The VSP had gone in to red during the NDA government led by Prime Minister Atal Behari Vajpayee and it wanted to privatise the plant. This move was strongly resisted and the Centre came to the rescue of the VSP. The plant cleared all debts and went into profits.

During the UPA, the VSP was made to invest and commission the Wheel and Axel Plant in the Rae Bareli Lok Sabha segment in Uttar Pradesh, represented by Congress president Sonia Gandhi. The then Railway Minister and current West Bengal Chief Minister Mamata Banerjee, too, wanted the VSP to kickstart another plant in New Jalpaiguri in West Bengal.

As if these woes are not enough, the BJP government at the Centre allowed the privatisation of Gangavaram Port, standing on the land that belongs to the VSP. The port was supposed to function as a captive port for the VSP.

The State government allocated an equivalent land to the VSP in lieu of Gangavaram land in a remote forest area which proved to be of no use.

With the expansion plans of the VSP delayed for more than a decade followed by Covid and no captive iron ore and coal blocks, clipping its wings, capping the loan-raising limits have pushed the VSP into red, rue the trade union leaders.