TN govt opposes centre's decision to dilute stake in NLC

Tamil Nadu Government has once again the asked the Centre to reconsider its decision to dilute 5% stake in the Neyveli Lignite Corporation.

In a letter to the Prime Minister today Tamil Nadu Chief Minister J Jayalalithaa asked the Centre to reconsider its decision and said the future should not judge the Central Government as having sold family jewels at throwaway prices.

It may be noted two previous attempts to divest NLC shares to private investors, in 2002 and 2006, had to be aborted due to the pressure from trade unions and from the State Government. Several Unions at NLC are meeting today to discuss when to go on a strike regarding Government's decision. 

 

“It is with a deep sense of disappointment and dismay that I took note of your letter dated June 8, 2013, and the recent approval of the Cabinet Committee on Economic Affairs (CCEA) for the disinvestment of 5 % of NLC’s shares. This is yet another instance in which the Central Government has ridden rough shod over the very legitimate and genuine concerns of the people of Tamil Nadu,” said the Chief Minister.

 

She noted, in her letter dated May 23, 2013, not only outlined the negative fallout of the decision to disinvest in NLC but had also offered two very feasible alternatives to overcome an artificially created regulatory crisis.

 

“I am deeply disappointed that the Government of India has dismissed both the alternatives without any serious consideration. I am surprised to find from your letter that signalling to financial markets has taken precedence over the welfare of thousands of workers and the concerns of the people of Tamil Nadu, as articulated by their democratically elected Government,” said the Chief Minister.

 

She added, the Government of India appears to have placed the immediate possibility of raising just Rs 466 crore by the sale of shares, above the aspirations of the people of Tamil Nadu to maintain intact the public sector character of NLC without any dilution.

 

The State administrator also questioned the timing of the decision on the back drop of fall in the share markets and whether the true value of the shares of a profitable Navaratna Public Sector Enterprise will be realised by the Government of India.

 

“The future should not judge the Central Government as having sold family jewels at throwaway prices,” said the Chief Minister.

 

The decision to go ahead has been taken without considering the consequences and the Prime Minister has mentioned that the management of NLC had already consulted the Trade Unions and Employees Associations and taken them into confidence. But almost all the Trade Unions have announced that they are planning agitations against the decision of disinvestment.

 

“The Central Government’s hasty and poorly reasoned actions have left the Government of Tamil Nadu facing entirely avoidable potential labour unrest which could further exacerbate the difficult power situation in the State,” said Jayalalithaa.

 

The NLC disinvestment issue should not be seen merely from the point of view of complying with the SEBI rules/guidelines or with sending out market signals. Rather, the wider ramifications must be kept note of. “Hence, I hope that you will reconsider the matter in the light of the options I had already suggested in my earlier letter to avoid the proposed disinvestment in NLC,” she said.

 

The Chief Minister today once again reiterated her request to reconsider the decision to disinvest 5 % of shares of Neyveli Lignite Corporation and thereby fulfil the wishes of the people of Tamil Nadu to retain the public sector character of Neyveli Lignite Corporation without any further dilution, said in the letter.