Is Modi Govt Trying to Shut a Profit-making PSU?

Continuing its attempts at dismantling the public sector systematically, latest in the line facing disinvestment is the Sahibabad-based Central Electronics Limited (CEL). The selling of the public sector undertaking (PSU) under the Ministry of Science and Technology threatens to put on line the livelihood of a thousand workers.

The workers of CEL are not giving in easily to the pressure of disinvestment bids by the government. The workers’ indefinite strike – that has continued for over a month – and demonstration outside their factory is gaining momentum. Speaking to Newsclick, TK Thomas, who is part of the joint committee leading the agitation at CEL, said, “We are protesting every single day, wearing black armbands to work, taking turns to sit outside during the protest. The primary reason for the protests against the government is that we are a profit-making PSU unlike others, then why has the government started taking applications from private bidders to disinvest in us, and sell off 100 per cent of its stake?”

Employees call CEL a ‘national asset’, but the government is selling 100 per cent of its stake in the company. The company has a net worth of Rs 50.34 crore as of March 2017, and had a turnover of approximately 21 crores last year. The protesting employees have been asserting that CEL has been wrongly clubbed with other loss-making CPSEs. Thomas added, “The company is profitable, the government must retain control.”

Passing the buck to NITI Aayog, the government had previously stated there is little they can do about it going ahead; clearance to the disinvestment proposal was given last year for 100 per cent stake sale through strategic sale with transfer of management control. Thomas told Newsclick, “Currently, the government is calling out to the bidders, the last date was previously set as 21st October, however, has now been extended to 15th November.” Workers are also suspicious because the ‘Invitation of Expression of Interest’ document has just two major eligibility criteria for interested bidders – they should have minimum net worth of Rs 50 crore as of March 2018, and should have been in existence for at least three financial years as on March 31, 2018.  The workers enraged with the Modi government have stated that the land that the company occupies currently is valued at over Rs 1,000 crores. However, as the government aims to privatise the PSU, attempts are being made to devalue the cost of the land, with many on the ground fearing that this is being done to benefit corporate interests, the nature of which they are not entirely sure of.

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Intensifying their agitation, the workers have written letters to the prime minister, UP CM Yogi Adityanath, and also to the Union Ministry of Science and Technology, however to no avail. Vowing not to back down, the workers are in talks of taking to the streets followed by legal recourse if needed.

The company established in 1974 – currently under the administrative control of the Department of Scientific and Industrial Research (DSIR), Ministry of Science and Technology – has played an important role in the electrification of remote and hilly areas where private players are reluctant to go, and also produces sophisticated products like the Phase Control Module (PCM) that is used in missile systems and is of strategic importance for India’s security.

Given that the CEL has earned accolades for its development of strategic devices and components, the attempts to sell it off look arouse curiosity about the government’s intention. The company has also been given a contract by the Maharashtra government for a project worth Rs 650 crores.

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