In PSU Privatization Move, KCCI Says Local Investors Must Be Roped In

SRINAGAR: Kashmir Chamber of Commerce and Industry on Friday expressed concern at press reports about the closure and privatization of Public Sector Undertakings and government-owned Corporations.

In a statement, the spokesperson stated that the privatization of PSU’s was a long pending demand of the Kashmir Chamber of Commerce and Industry prior to the constitutional changes to Jammu and Kashmir.

He said that the demand of the KCC&I was based on the wanton waste of assets, nepotism, mismanagement which had resulted in the raking up of liabilities of around 15,000 Crores and locked up critical economic assets of Kashmir in the shape of infrastructure, land, manpower and sectoral potential of key areas.

“In normal conditions, the KCC&I would have welcomed the step towards privatization but post the constitutional changes made to Jammu and Kashmir in August 2019, it has instead become a cause of concern,” said KCCI spokesman in a statement.

“After August 2019 the Government of Jammu and Kashmir has made changes to the mining policy which opened up the sector for non-locals,”  said the spokesman.

“Earlier the rights were exclusively reserved for the local stakeholders only. The subsequent auction of mineral blocks in Kashmir showed an alarming take-over of the business by a non-local syndicate. Local contractors and other persons associated with the business since decades stand deprived of their only source of income. The prices of construction material like sand has also shown a sharp spike, in many cases consumers have complained of almost a hundred percent price hike. Thus, the change in policy is against public interest as well as the interests of the local stakeholders,” he said.

“Now that policy decisions aimed at exposing of key economic assets of Kashmir to open bidding and auction are being put into action, it would be pertinent to raise questions regarding the protection and claim of the natives of Kashmir in this regard,” he added.

“The Government of Jammu and Kashmir – in whatever constitutional form it may acquire – cannot ignore the views, feelings and sentiments of the people of Jammu and Kashmir. There has been a commitment of true empowerment of the people but ill-advised policies could ultimately result in the disempowerment of the people,” said KCCI spokesman.

Speaking of disempowerment, several political organisations have also described the move as “shocking” “appalling” and “unfortunate”. Keeping in view the involvement of public interest, we feel that it is necessary to express our views in unambiguous language.

The KCC&I had been time and again inviting their kind attention to the pathetic condition of the PSU’s and the colossal drain the undertakings and corporations were causing to the economy of J&K. In many undertakings, mandatory annual audits were not carried out for decades. It would be perhaps relevant to reproduce an excerpt from the joint press conference of the Kashmir Chamber of Commerce and Industry and the Jammu Chamber of Commerce given in Srinagar the year 2017 which reads as under: “…..we are concerned at the losses to our economy being caused by the lack of accountability in the Public Sector Undertakings. A conservative estimate shows the current liabilities of these PSU’s to be upwards of Rs 10,000 Crores. In addition, the locking up of resources in the shape of infrastructure, land, manpower and potential has a consolidated negative impact – primary and consequential – running into lakhs of crores…..”

“There were several other red flags raised by the KCC&I. Decades of neglect and unproductive policies only transformed the condition of the PSU’s from bad to worse. Instead of taking tangible and concrete steps towards stopping the drainage of capital, the PSU’s and Corporations became rehabilitation centre’s for out of work politicians and employment exchanges for party workers who were “adjusted” as Vice Chairmen of PSU’s. As many as 16 appointments were made with a reported consolidated pay of around Rs 1.5 lakhs per head, official bungalows, chauffer driven vehicles, personal staff and other perks and benefits. The PSU’s became breeding grounds for politically motivated engagement of employee’s, nepotism and corruption. We equally share the blame of allowing it to happen. The press statements of political parties have only focused on job losses and chosen to ignore the most discriminatory factor of the new policies which would result in the complete marginalization of the local stakeholders.”

“Be that as it may, instead of shedding crocodile tears and press releases we would humbly suggest all parties to come out of the trauma the move has reportedly put them in and take concrete steps to ensure that the assets are not lost forever. For the time being, there has been a complete reservation for natives of Kashmir only. It is for the leadership to devise a strategy for achieving that,” he said.

“It would also be worthwhile to bear in mind that the constitutional changes made to Jammu and Kashmir in August 2019 have been challenged by several petitioners in the Supreme Court of India. Since the matter is pending consideration of the Supreme Court of India which may take a view in the coming time, it would perhaps be prudent not to rush through policies which could adversely impact the economic interests of any party when a final decision is taken in the case,” the spokesman said.

“ In case the Supreme Court of India concurs with the views of the petitioners, any non-local investor would suffer irreparable losses and damages which could be avoided by exercising restraint and focusing on the potential of local stakeholders who best know the frequently changing conditions of Kashmir as well as the back of their hand. Provide them a conducive and stable environment for business and make enabling policies, the results could spring a surprise for the most cynical of observers. Their claim is also substantiated by the losses they have suffered over a period of time. The KCC&I is on record to have estimated the losses to be in the vicinity of Rs 18,000 Crores and 5 lakh job losses for a period of only four months from August to December, 2019,” KCCI spokesman said.

KCCI spokesman in a statement said, “economic experts have predicted a period of deep recession and massive GDP contractions in the coming months. As various sectors of our economy continue to suffer from massive stress, the Rs 20 lakh package announced by the Central Government proved to be only a drop in the ocean for Kashmir’s beleaguered business community.”

“Most of the interventions are aimed at the revival of businesses under stress from March 2020 onwards, whereas Kashmir has now entered the 12th month of lockdown. For local stakeholders, it is a question of survival and not of revival or growth. In such a situation, any policy having the effect of hurting the interests of native stakeholders would not only be a failure of the Government of J&K to watch over and protect the interests of it’s citizens but would also be a grave injustice with the people,” said KCCI spokesman.


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