Unions seethe with anger as RINL issues circular for third round of VRS

The fears over plans for disinvestment of Rashtriya Ispat Nigam Limited (RINL), the corporate entity of Visakhapatnam Steel Plant post-Rs.11,440-crore revival package, further strengthened among the employees with the Human Resource Department (Corporate Services) issuing a fresh circular on Wednesday for third round of Voluntary Retirement Scheme (VRS).

Earlier two rounds of Golden Handshake Scheme, the drastic reduction in contract workers and the awarding of maintenance works to various important facilities after the Centre about a year ago launched the widely publicised revival package, led to suspicion among the trade unions that the pruning of staff and contract workers is an attempt to hand over RINL to private hands.

VSP, popular as Vizag Steel, was established after a mass movement under the 'Visakha Ukku Andhrula Hakku' agitation leading to killing of 32 persons in police firing. VSP, India's first shore-based integrated steel plant with a total capacity of 7.3 million tonnes, is considered the 'Pride of Telugu States of Andhra Pradesh and Telangana.'

The circular evoked strong condemnation from CITU, AITUC and Visakha Steel Employees' Congress (VSEC) who termed this a part of strategy to create the ground for privatisation of RINL.

The circular stated that those eligible superannuating after 01.01.2026 should apply online on or before January 20, 2026 from the first day of the New Year. Online screen for withdrawing the application shall be open till January 23.

Unofficial sources said in the first phase out of 1600 applications, the management accepted VRS to 1100. In the phase-2, 480 were granted VRS as against a total 1100 applications. The trend suggests that uncertainty over the future is driving more employees to opt for VRS; though the company is not keen on granting VRS to those being ranked as 'star performers.'

The employees in the past had also gone on protests over downsizing of contract workers. The number at present has come down from 16,000 in 2024 to 10,000. The permanent workforce strength has been pruned from 18,000 in 2005 to 9,200 as on today. The production capacity was three million tonnes in 2005 whereas after revival package, the steel plant is operating all the three blast furnaces and producing almost 19,000 tonnes of hot metal per day, almost at a rate of six million tonnes per annum for the first time in its history. RINL increased its capacity from three to 7.3 million tonnes in phases with a total investment of around Rs.16,300 crore. The heavy capital expenditure (Capex) and raw material insecurity for want of grant of captive mines weakened the financial health of the company over the years making it precarious and the subsequent decision by Cabinet Committee on Economic Affairs for its disinvestment by way of 100% privatisation on January 27, 2021.

"There is a systematic bid to dampen the spirit of the workforce and make RINL sick so that it can be privatised completely," INTUC-affiliated VSEC Chief Patron Neerukonda Ramachandra Rao told Bizz Buzz. He said already after the launch of revival package, the maintenance of key facilities like sinter plant 1 & 2, Coke Oven Department, Raw Material Handling Plant, Oxygen Plant-2 and four chilled water plants has been privatised. Expression of Interest bids for 32 vital facilities like blast furnace, steel melt shop and rolling mills are at various stages of consideration.

Ramachandra Rao said management courted another major controversy by issuing a circular on November 11 to pay salary based on production. "Generally, n where production is not linked to payment of wages. Production-linked incentives are given but not the salary anywhere," he bemoaned, adding the pending salaries should be disbursed before the Sankranti festival and circular on production-based wages be withdrawn.

CITU State general secretary Ch. Narsinga Rao allotment of captive mines and merger of RINL with SAIL are the only permanent solution to prevent privatisation of the Visakhapatnam-based Navratna company.