Vizag steel privatisation grabs political centre stage in Andhra

The Central government’s decision to privatise Visakhapatnam Steel Plant (VSP) is going to roil Andhra Pradesh for a long time to come, both socially and politically.

The decision came as a bolt from the blue for the thousands of VSP’s employees and their families, who would have been thinking that their job was a secure government job.

Suddenly, the company famous for producing steel products such as rebars, plain rounds, wire rod coils, structural, special steel and others is thrown into uncertainty.

At a time when the state is witnessing two indefinite protests in Amravati, one supporting the trifurcation of the capital city and other opposing, Visakhapatnam or Vizag has just joined the list with its own share of demonstrations to salvage the steel plant.

Of the three capital cities planned in the southern state, two, legislative capital Amaravati and executive capital Vizag, are in the grip of protests now and nobody knows how long they will last.

For a change, all political parties are on the same page as far as opposing the privatisation bid goes. However, the principal parties — ruling YSRCP and opposition TDP — are losing no opportunity to snipe at each other on the issue.

Hundreds of steel plant employees, their family members, Left parties, opposition Telugu Desam Party (TDP) and ruling Yuvajana Sramika Rythu Congress Party (YSRCP) leaders and supporters and others are undertaking protests to stall the privatisation.

The agitators have also taken out a few massive motorcycle rallies to protect the steel plant which was sanctioned to the state after 32 lives were sacrificed decades ago.

In fact, supporters of the steel plant wasted no time in getting together to oppose the privatisation plan tooth and nail the moment it was announced in the 2021-22 budget.

“This is the worst decision taken by the Modi government. Making a 100 per cent strategic sale of the steel plant is wicked. Andhra Pradesh developed because of Visakhapatnam steel plant,” said Communist Party of India (CPI) leader Narsing Rao in one of the first agitations opposing the move.

He reminded that the city has the history of salvaging the Dredging Corporation of India Limited (DCI) by fighting with the Central government.

If the need arises, he threatened that agitators would stall the state to save the steel plant from privatisation.

CPI leader J. V. Satyanarayana Murthy said people of Visakhapatnam need not be taught how to fight, reminding that the steel plant itself was procured after a big movement.

“Though Union Finance Minister Nirmala Sitharaman came as a daughter-in-law to Andhra Pradesh, she has now thrown chilli powder into her mother-in-law’s eyes. She is attempting to plunder the riches of this state or dole them out to the people the Centre likes but we will retaliate,” Murthy added.

Not only the steel plant employees, he added, people in Andhra Pradesh would repel the move to sell the steel plant.

Andhra Pradesh Chief Minister Y.S. Jagan Mohan Reddy has written to Prime Minister Narendra Modi opposing the proposed privatisation of the Steel Plant.

In the letter, he urged Modi to reconsider disinvestment of the steel plant and suggested a few alternatives to the move, saying the steel plant stands as an icon of Telugu achievement in the people’s collective psyche.

“The people of my state rallied for the VSP in which 32 people have laid down their lives. On April 17, 1970, the then Prime Minister Indira Gandhi had announced the Government of India’s decision to establish a steel plant at Visakhapatnam culminating the decade-long public agitation “Visakha Ukku-Andhrula Hakku” in the undivided AP,” the CM added.

He said the plant registered good performance between 2002 to 2015, earning profits with positive net worth, which pragmatically turned-around after being reported to the Board of Industrial and Financial Reconstruction (BIFR) as a sick company earlier.

A couple of days after Reddy’s letter, actor-politician Pawan Kalyan flew to Delhi to meet with the Central leadership to ‘save’ the steel plant but later conceded that the public enterprise is under the purview of the Central government.

Meanwhile, TDP national general secretary Nara Lokesh upped the ante on the ruling party, alleging that YSRCP was playing a dubious role and failing to put pressure on the Central government to stop the privatisation.

“The steel plant should remain in government control, considering how Andhra people waged prolonged agitations and farmers gave away thousands of acres of their ancestral lands. The Jagan Moharn Reddy regime is playing a dubious role in the whole privatisation plan,” claimed Lokesh.

Ganta Srinivas Rao, a TDP MLA from Vizag even put in his papers protesting the steel plant sale plan while TDP supremo Nara Chandrababu Naidu went a step ahead and demanded Reddy to stop the privatisation or resign.

“Stop the sale of the steel plant or resign and go to jail or wherever you (CM) would like to go. If YSRCP continued its games of betrayal against the people’s sentiments even now, the people of the state would rise in revolt and they would not allow the ruling party leaders to move on the roads,” roared Naidu at a public meeting in the port city.

He was supposed to extend solidarity to party leader Palla Srinivas’ indefinite fast protesting the privatisation but the government forcibly ended the hunger strike.

To calm the tempers of the agitators, Reddy met with the labour union leaders on Wednesday and informed them of the three suggestions he gave to Modi to salvage the plant.

Allocation of mines in Odisha, converting bank debt into equity, and selling steel plant’s surplus land were the three major suggestions given by Reddy to the Prime Minister, among others.

Already, some people have started targeting the CM for suggesting selling only surplus land, attributing several apprehensions.

It remains to be seen if Modi would heed to any of those suggestions or just go ahead privatising the plant.

According to Reddy, the plant has about Rs 22,000 crore debt, out of which up to Rs 11,000 crore was availed as working capital debt, including some debts availed at hefty interest rate of up to 14 per cent.

One thing is definitely clear, the Central government’s privatisation move has thrown a spanner into Reddy’s plans of moving the executive capital to Vizag, sources said he was keen on doing it in March.

Will the steel plant protests, participated by all the opposition parties be of any hindrance to the capital move plans? We have to wait and watch.

Meanwhile, Bharatiya Janata Party (BJP) did not do any favour for itself by the privatisation move as capturing power in the southern state is one of its unfulfilled dreams.

Depriving the special category status, railway zone and other concessions to the state, which suffered irreparably during the politically opportunistic bifurcation will not endear BJP to the Telugus, despite Sunil V. Deodhar, BJP’s state co-in-charge staying put in the state.

Meanwhile, the Central government hasn’t responded to Reddy’s suggestions or the protests in faraway Vizag, even as it is busy dealing with the mighty farmers protests in near Delhi.

(Sharon Thambala can be contacted at