IS IT NECESSARY THAT THE PUBLIC SECTOR HAS TO BE SOLD OFF LIKE INSECT INFESTED BRINJAL BY DESPERATION?

 

IS IT NECESSARY THAT THE PUBLIC SECTOR HAS TO BE SOLD OFF LIKE INSECT INFESTED BRINJAL BY DESPERATION?

Some classic instances are coming to sight. After Air India, TATAs got this gift from the Public Sector basket by paying a small price. I am commenting and making this post after reading the news item of Business Standard, the link of which is given below.

Look at what the Plater of the gift has got inside it , this is what (composition of the acquisition) the news item says, not me:

--1.1 Million (11 Lac) Ton (per year ) Capacity Steel Plant (Neelachal Ispat Nigam Limited -NINL, located near Jajpur Road, in Odisha, India).

--Iron Ore Mines having estimated reserves of 90 Million (900 Lac) Tonnes, Spread over 2500 Acres of Land with future expansion scope.

--All at an acquiring cost of just Rs. 12100 Crores ( USD 1.61 billion approximately at USD/INR 75.00).

In case of Air India, lot of people were shedding tears that Air India was nationalized in 1953 ( it was not a crime then, it was the bare necessity for the Nation then, a Tata had just started it while the Nation had flown all the sweat for it), so that Tata should get it back, even if it amounted to, by paying pea-nuts. (They had paid just Rs. 18000 Crores against a Book Value of Rs. 62000 Crores as per published records ).

This Steel Plant (NINL) was a joint venture of Central Govt and State Govt and some other Public Sector Corporations with a modern plant. No Tata had started it, it was all started and owned by People of India.

I am surprised, at the same time I expect, it could be understood by the readers very well that, Privatization does not mean, public sector has to be sold like insect-infested brinjal, even if it goes sick by bad management, it has a value and that value has to be realized for the people of India. Only Auctioning where few firms only quote whatever they want, can not be the only divestment process and to be acceptable. If the auctioning process does not get deserved value, the auctioning authority has right to abandon the auctioning process and hold the asset. Somewhere the Nation is missing the Bus.

I am not against anybody, but I am anguished as a Management Expert  and I am not convinced by the state of affairs.

I am not convinced as a Management Student that, the Chairman or Emeritus Chairman of any Organization will be worshiped like a God, when they snatch the Public Sector assets of the People of India by paying pea nuts as engineered value and not its deserved value. I am not sure how the valuations are being done and get approval, as it is not made public.

Doing some charity or philanthropic activity from profits/dividends of organizations, does not condone the effort to snatch public sector by paying pea-nuts to the people of India, by whatever process it may be.

Good Governance never means selling public sector without realizing its deserved value, whatever may be the compulsion.

As an Independent Citizen, I am rightful and entitled in making this comment after reading this news, and I am not making and not intending to make infringement of anyone's authority, making it clear precisely. I have the citizen rights to have a critical view of actions.

I would comment rightfully that, India should not be in a hurry to get rid of Public Sector in desperation, the Nation needs it to be retained and managed until 2050 at least, allowing India at least 100 years post-independence ( roughly 3-decades more, count from 1947), while USA had taken more than 200years after their independence to become private sector heavy. If there is no intention to retain and manage Public Sector, the profit making public sector, everyone of them will be sick tomorrow, as non-milking holy cows (after they stop giving milk) are some times sold mercilessly to go to the slaughter house. If we are desperate some where to become private sector heavy like USA over night, we may have aspirations to match shoulders with USA any day, that is our problem and we are getting out of track as far as the need of the Nation (India) is concerned.

I will never be convinced by CSR or other patch up activities around such steel plants or mining areas done by whatever named trusts.

Those who have gone through the News Item of Business Standard, would have observed, the acquirer company says; it is "Historic Achievement" for them, that means they got what they wanted to snatch from the public sector. Land of 2500 Acres with Reserved Iron Ore Mines Back up of 90 Million MTs and a Modern Steel Plant of 1.1Million MTs, would have been next to impossible for them to carve out in private sector at the cost they paid for. Hopefully, no more Steel Plant of the Public Sector gets axed in future like this.

Link of the News Item of Business Standard:

https://www.business-standard.com/article/companies/tata-steel-completes-rs-12-100-cr-acquisition-of-ninl-via-step-down-arm-122070401087_1.html?fbclid=IwAR3shU5VxF7U9-K3ZhXsqqFJWjJajJTk_ZqfaMZ3VzNDEtxHpVcWiFLAuSE

About the Author : Dr. Nimain Charan  Biswal is a B.Sc.(Agri. Science and Technology), M.B.A. and Ph.D.(Management Area ) by qualifications; and he has 36+ years of work experience in both  industrial and development sectors in diversified fields of social importance. He has been educated at Orissa University of Agriculture and Technology (OUAT)-Bhubaneswar, Institute of Rural Management Anand (IRMA) and Gujarat University (with Resource Support of IIM-Ahmedabad). He is further educated at IIM-Calcutta, XLRI-Jamshedpur, Apple Computer Industries and Spar Inc., USA. He has worked for reputed National and International Organizations in Senior/Top Management Capacities at Board level as well as Managing Director and CEO. He is a management expert covering extensive areas from management in industrial sectors, management in agriculture and dairy, development management to management of public systems. He is a prominent professional of India and known Internationally as well. He lives at Mumbai in India.