Tamil Nadu CM urges Centre not to privatise Salem Steel Plant

Chennai, April 27 (IANS) Tamil Nadu Chief Minister Edappadi K. Palaniswami has urged the Centre to reconsider its plan to privatise Salem Steel Plant, citing the package of incentives given by the state government to the plant.

In a letter to Prime Minister Narendra Modi on Thursday, the text of which was released to the media here, Palaniswami said the state government has supported the expansion project costing Rs 2,005 crore of the Salem Steel Plant with a structured package of incentives in the form of soft loan, capital subsidy, electricity tax exemption and environmental protection subsidy.

"In 2015, the government of Tamil Nadu granted an extension of one year from November 1, 2010, to October 31, 2011, to enable Salem Steel Plant to complete its expansion activities and avail the incentive package," he added.

"Given the above context, where the establishment and subsequent expansion of the Salem Steel Plant have received so much support from the people and Government of Tamil Nadu, primarily on account of its public sector character, the recent news of the proposed privatisation of the plant by the Indian government has caused a lot of apprehension and dismay amongst the people of the state," Palaniswami said.

"Land is perhaps the most valuable and sought-after asset in the possession of Salem Steel Plant today," he added.

According to Palaniswami, the state government had acquired about 15.5 sq km of land in nine villages more than four decades ago in the foot hills of Kanjamalai, Salem district.

"It was possible to undertake such extensive land acquisition mainly because of the public sector character of the plant. Today, any proposal to privatise the Salem Steel Plant would cause considerable unrest amongst the people, particularly amongst those whose lands were acquired," Palaniswami said.