Kerala chief minister Pinarayi Vijayan has told the Prime Minister that preventing a state government from bidding for a public sector undertaking is against the principles of cooperative federalism.
In a letter to Prime Minister Narendra Modi, Vijayan expressed the state government’s disappointment at being disallowed from bidding for HLL Lifecare Ltd, a central PSU based in Thiruvananthapuram, lined up for 100 per cent disinvestment.
The chief minister urged Modi to take note of “the fact that preventing a state government from participating in an opening bidding process will not be in accordance with the principles of cooperative federalism.”
Vijayan urged Modi to permit the state to participate in the bidding process that closes on Monday.
“The state government has the competence accorded to it by the Constitution to take decisions on its own (in) such matters,” he wrote.
A PSU that has been an integral part of the country’s family planning programme, the HLL Lifecare Ltd is a leading manufacturer of condoms , contraceptive pills and surgical gloves, among other products. Run by the ministry of health and family welfare, the HLL is listed by the Department of Investment and Public Asset Management (DIPAM) of the ministry of finance for disinvestment.
The state government had earlier assigned the Kerala State Industrial Development Corporation to participate in the bidding after trade unions of HLL launched protests against the disinvestment move.
The chief minister disputed the Centre’s contention that state governments are not allowed to bid for PSUs.
“It is not specified anywhere that state government/ state PSUs are not eligible in the bidding process of HLL,” he said.
The chief minister said the state government had acquired the land for HLL Lifecare Ltd and handed it over to the Centre, and hence it should be given the option to retain it as a state-run PSU.