The Telegraph
Since 1st March, 1999
Email This PagePrint This Page
Court nudges Bihar for reforms

Patna, Oct. 20: The chords in Laloo Prasad Yadav’s anti-privatisation rhetoric are ringing hollow, with the Rabri Devi government deciding to put on the block 22 sick public sector units on the proposal of the state industries department.

The recommendation follows a Patna High Court order to close down 49 sinking PSUs after clearing the arrears of the staff.

The state electricity board will be privatised once it is trifurcated and granted autonomy. The two steps are believed to be part of the conditions laid down by the National Thermal Power Corporation in the memorandum that Rabri Devi is supposed to sign soon. There are also proposals to involve some trusts or societies in running at least six of the state hospitals after granting them total autonomy.

The Bihar government had turned a blind eye to the spate of suicides by employees of sinking units and the crisis of non-payment of salaries to state staff, but was forced to sit up recently when Patna High Court directed it to clear the arrears of 54,000 employees.

The court ruled that it might not be obligatory for the government to pay salaries of the employees of sick government undertakings, but it should clear their arrears by selling the assets of the units. The government will have to begin a process of liquidation of 49 boards and corporations, sell their assets, the land on which they are located and generate resources to pay off the arrears.

The boards identified for immediate liquidation include the State Sugar Corporation, which controls 15 sugar mills financed by the government. A senior corporation officer said an estimated Rs 126 crore is required to clear the arrears of the 10,000 employees. Sale of assets will not be enough to raise that amount, he said.

The proposal to sell 22 other units is being resisted by the employees, who are still getting a part of their salaries. The state electricity board staff is also against trifurcation. Bihar power minister Shakil Ahmed Khan has clarified that “we are not calling it privatisation. It is trifurcation to grant autonomy, and we have to go ahead with this”. But his assurance has found no takers.

The privatisation process, spurred by the high court and now believed to be nearing finalisation, will queer Laloo Prasad’s pitch. The Rashtriya Janata Dal has been at the forefront of a campaign against the closure of the Sindhri and Barauni fertiliser units by the NDA government. The high court directive and the industries department proposal have caught the party off-guard. If the liberalisation process is set in motion, Laloo Prasad will have to water down his anti-privatisation rhetoric considerably.

The RJD leadership is divided on the issue, but for now the buzzword in the party is rationalisation and packaging of the policy by churning out alternative expressions of privatisation. Party general secretary and member of the think-tank Rambachan Rai said the present “structural changes” are unlikely to create any political problems for the party. “After all, we are yet to lose state control on organisations like BSEB or the hospitals,” he said.

Bhola Prasad Singh, another senior RJD leader, believes there won’t be any confusion between the NDA stand and the RJD policy.

Party workers will be explained the difference between outright sale of Central undertakings by the NDA government and a policy of structural change that the Rabri Devi government is trying to implement.

Email This PagePrint This Page