Vijay strongly opposes NLCIL disinvestment

Chennai, June 26:

Expressing deep concern and strongly opposing the Centre’s proposed move to reduce its stake in the profit making public sector Neyveli Lignite Corporation India Limited (NLCIL), Tamil Nadu Chief Minister Vijay on Thursday urged Prime Minister Narendra Modi to reconsider its decision to disinvest three per cent of its shareholding from it.

In a Demi-Official letter to Mr Modi, he opposed further dilution of government’s equity in NLCIL.

He said Tamil Nadu has consistently maintained that the Government of India’s shareholding in NLC India should not be reduced further as public sector enterprises of this nature, particularly those established and expanded with the sustained support of a host State over decades, should continue to remain firmly under effective Government ownership and contro and requested the centre to reconsider its decision relating to the proposed disinvestment.

Converying the state’s deep concern regarding the decision of the Union Government to proceed with the proposed disinvestment of its equity in NLCIL through an Offer for Sale of
up to 3% of the paid-up equity, comprising a base offer of 2% and an additional 1% green-shoe option, as notified, the Chief Minister said the Tamil Nadu Government strongly opposes, in principle,
any further dilution of the Government of India’s equity in NLC India Limited.

This issue is of special significance to Tamil Nadu, as NLC India is intrinsically linked to the State through its origin, growth and continuing operations, he said.

Pointing out that NLC India is headquartered at Neyveli, Tamil Nadu, where its principal lignite mining operations—Mine I, Mine IA and Mine II—and its major pit-head lignite-based thermal power stations are located, Vijay said the enterprise has been built over several decades on land acquired through the State machinery, supported by extensive administrative facilitation, infrastructure development, rehabilitation measures and the cooperation of the people of the state.

Therefore, Tamil Nadu has a legitimate and enduring stake in the future of this strategically important public sector undertaking, he said, adding, The TN Government is of the considered view that
NLC India is not merely a listed company but a strategic national asset engaged in energy security, mineral development and critical infrastructure.

Any further dilution of the Government of India’s equity, however limited, sets an undesirable precedent in respect of public ownership of such strategically significant enterprises. It also
raises concerns that extend beyond financial considerations and touch upon the long-term interests of the State, its people and the nation’s energy security, the Chief Minister noted.

Tamil Nadu has consistently maintained that the Government of India’s shareholding in NLC India should not be reduced further. “Public sector enterprises of this nature, particularly those
established and expanded with the sustained support of a host State over decades, should continue to remain firmly under effective Government ownership and control”, he added.

“In these circumstances, I request the Government of India to reconsider its decision relating to the proposed disinvestment. I sincerely hope that the Government of India will give due
consideration to the concerns and principled objections of the Government of Tamil Nadu”, he said.