People's Democracy

THE Centre of Indian Trade Unions (CITU) has strongly condemned the conspiracy to destroy the public sector steel giant SAIL under the garb of restructuring, in blind pursuit of the retrograde prescription of two foreign consultants --- M/s Mckinsey and M/s Boston Consultancy Group (BCG).

Through the direct intervention of the PMO, the government of India appointed M/s Mckinsey as a consultant and the firm recommended the hiving off of major units from the Steel Authority of India Ltd (SAIL). Its recommended the sale of the Salem Steel Plant, Alloy Steels Plant, MEL and IISCO, the sale of important utilities like captive power plants and oxygen plants, and then the breaking of the rest of SAIL in two groups of plants based on product lines. It further suggested dismantling of the SAIL’s Central Marketing Organisation, which has a fully operative countrywide marketing network, into pieces to be attached to separate groups of plants. Another American consultant, the Boston Consultancy Group, further fine-tuned the Mckinsey recommendations. The government of India and the SAIL management are moving ahead to implement these recommendations.

The CITU is of the firm opinion that the above recommendations of the foreign consultants aim not at improving or strengthening the public sector steel industry but to destroy the SAIL, to break it into pieces, so as to facilitate its easy sale to foreign players for a song. The reason is that it is difficult to get a buyer, even from abroad, for the SAIL in its present size. All the trade unions operating in the steel industry, irrespective of their affiliations, have conveyed their firm opposition to such disastrous moves to destroy the SAIL, but the government and the SAIL have no care for their opinion.

In fact the mega monolithic structure of SAIL, which provides for an effective backward and forward linkage in production and marketing, has proved to be of intrinsic vitality for the SAIL to survive and move forward even in the face of extreme hostility of the market in a slowing-down economy. In reality, the need of the hour is to revamp the steel industry in the background of the widespread economic slowdown, and to strengthen the monolithic integrated structure of SAIL with focused policy support for the steel industry from the government. The need of the hour is also to remove the serious anomalies and discrimination in tax structure on domestically produced steel vis-a-vis the imported steel. The need is to tone down the high level of taxation on essential inputs, address the problems of dumping from the CIS countries particularly in respect of flat products, rectify the anomaly in the existing advanced license scheme allowing duty-free steel import for export-oriented projects, and to boost the steel consumption in the economy through increased public investment on construction and other projects, besides many other things. The least that needs to be done in the depressed market situation is to strengthen the marketing network for more aggressive marketing and not to dismantle the Central Marketing Organisation of the SAIL.

The CITU has strongly condemned the anti-national and destructive move of the government of India and of the SAIL management. It has called upon the steel workers and concerned trade unions in particular and the working class in general to oppose and resist such disastrous plans by a organised united industry-wide struggle. (INN)