Union Finance Minister Arun Jaitley’s remark that the public sector units should either shape up or ship out betrays the Modi Government’s inherent anti-PSU bias. The NDA Government’s announcement that it would close down ailing PSUs and will sell shares of profit-making PSUs gives the game away and shows what is ahead for the hapless PSUs.

Kerala, whose case has gone by default under the Modi Government, is no exception. An immediate victim of the Modi Government’s PSU-hostile policy will be the ailing public sector unit, Fertilisers And Chemicals Travancore (FACT) Limited. FACT, which had pinned great hopes on a bailout package, got the shock of its life when Jaitley’s budget maintained a deafening silence on it.

The FACT, which is battling for survival, was badly let down by the erstwhile Manmohan Singh Government which hinted at a bailout package of Rs 900 crore. But thanks, to an insensitive bureaucracy and a not-so-PSU friendly Government, the package was delayed.

Meanwhile, Lok Sabha elections came, and the Modi Government has taken over. And the BJP-led Government has followed in the footsteps of the UPA Government by turning a blind eye to the ailing PSUs’ cry for help to turn them around.

FACT, which had made profits during the four-year period 1984 to 1987, has been making losses for the last 17 years mainly because of the hostile policies of successive governments. The policy changes forced it to close down the ammonia plant. One of the reasons for the sad plight of the FACT is the refusal, despite the strong recommendation of the Board of Recovery of the Public Sector Enterprises (BRPSE), of the Union Government to give compensation to it for the high prices at which LNG was sold to the company.

Now that the bailout package has been ruled out, the plight of FACT will go from bad to worse. There is a real danger of the huge machinery getting obsolete and corrosive. It is in imminent danger of being closed down, unless the Kerala Government intervenes and pleads its case vigorously with the insensitive Modi Government.

FACT is not the only PSU unit which is running the risk of closure. Other PSUs in Kerala which are running at a loss are the Kerala State Road Transport Corporation (KSRTC) (Rs 495-cr), Kerala Water Authority (Rs 296.33 crore), Civil Supplies Corporation (Rs 84 crore), Housing Board (Rs 19.29 crore), Textile Corporation (Rs 10 crore), Plantation Corporation (Rs 7.62 crore) and Kerala Automobiles (Rs 7.20 crore), among others.

The Modi Government’s new policy announcement would sound the death knell for all these PSUs, especially when the Government has declared, beyond any shadow of doubt, that there will be no revival packages for ailing PSUs.

Understandably, the Modi Government’s move has drawn flak from various trade unions in the state. Principal trade unions like the INTUC, AITUC and the CITU have demanded that the new government formulate policies aimed at reviving the PSUs. All of them are of the view that the employees were not to blame for the losses incurred by the PSUs. The losses should be attributed to inefficient leadership, corrupt managements and visionless policies, they say.

The TUs’ suggestions for the revival of the PSUs include, among others, granting of freedom and financial autonomy and putting in place professional managements. Will the TUs’ appeal find any positive response from the Modi Government? If its present attitude is any guide, then the answer to that question is in the negative. (IPA)