The non-executive employees of Dredging Corporation of India (DCI) is planning to go on an indefinite strike from December 6 to stop the government from privatising the organisation.
The “employees’ movement”, which is against the 74 percent sale of the government’s share in the company, began after finance ministry's Department of Investment and Public Asset Management (DIPAM) nominated a committee to initiate the process.
“The government is withdrawing its 73.47 percent of shares… They want to privatise it and go for the strategic sale… The employees want to stop the privatisation,” B.H Nayak, President, Officers’ Association of DCI, told Moneycontrol.
“They don’t prefer privatisation,” he said.
The Centre on November 1 decided to divest its entire 73.47 percent stake in DCI paving way for complete privatisation.
Employees at DCI have been expressing their resentment towards “privatisation” of the company as they believed that “any private player who (would) acquire the same would be interested in taking the company out of this scenic place to serve his own personal interest”.
Also read: Cabinet approves sale of govt's entire 73.47% stake in Dredging Corp
Officials at DCI said that the government’s nod to bring to close its entire shareholding “has not been (officially) communicated” to the organisation.
“There is no official communication from Government of India,” said Rajesh Tripathi, chairman and managing director, DCI, in his statement.
The employees, who now face an uncertain future as they “might be asked to take up voluntary retirement” option, are “against any stake sale”.
Nayak said that an 11-member committee has been formed to take the “strategic sale” forward.
“An 11-member committee has already been nominated for the strategic sale of the company…. That’s why people are agitating,” he said.
DIPAM formed an inter-ministerial group (IMG) on November 16 for “strategic divestment of Government of India’s equity of DCI through strategic sale”.
The chairman of the IMG will be secretary, DIPAM. Other members will include secretary (or representative not below the rank of joint secretary), Ministry of Shipping; financial advisor, Ministry of Shipping; financial advisor, DIPAM; CMD, DCI; director (finance), DCI and joint secretary, DIPAM among others.
A “private letter” written by the officers’ association of DCI, a copy of which was accessed by Moneycontrol, had advocated against the move citing that if the proposal is accepted, the private investors would “manipulate the advantage” of the publicly owned company instead of sharping their own competitive advantage.
“…and the Government will have no control over the same,” it read.
DCI was established in 1976 to provide dredging – underwater excavation activity--and maritime development services to the major ports of country. It is involved in maintenance dredging, capital dredging, beach nourishment, land reclamation, shallow water dredging, project management consultancy and marine construction.
Also read: Workers union threaten to go on strike against DCI sale
The Centre has set a target of Rs 72,500 crore to be generated through divestment for 2017-18. Out of this, Rs 15,000 crore has to come from strategic divestment. Divestment of DCI is a part of the Rs 15,000 crore bracket which would fetch the government approximately Rs 1,400 crore.
While DCI has been making profits during the past decade, the quantum has been falling consistently.
While the decade began with more than Rs 150 crore profit, it fell to a low of Rs 13.18 crore during 2011-12, before witnessing a steady rise. It recorded the biggest single year drop in profit after tax (PAT) in 2016-17, approximately 91 percent, falling from over Rs 70 crore to only Rs 7.41 crore.
Speaking to Moneycontrol, an official from the Shipping Ministry said that the proposal was “not being discussed for the past four months” and that the decision was “in the hands” of DIPAM.
The staff at DCI also said that the organisation was not in talks regarding the proposed divestment. They said that as the “government had already divested in four instalments during 1991-92 (1.44 percent), 2003-04 (20 percent), 2015-16 (5 percent) and 2016-17 (0.09 percent)… the outright sale was causing agony amongst the employee”.
Also read: Dredging Corporation hits 20% upper circuit as govt likely to sell entire stake
The staff also said that “there has to be a proper balance between government and private participation”, which it believed would be “wiped” if the “entire stake” was sold.
Nayak said that “privatisation would (also) raise security concerns of the nation”.
“DCI should not be privatised because it is also related to the security of the nation… Naval establishments are placed at DCI where private players cannot enter,” he said adding, “DCI also has facility for Differential Global Positioning System (DGPS)… With privatisation, everything will be at stake”.
He said that the employees are “not ready to accept any middle path” and has ruled out “talks for negotiation”.
“The organisation’s privatisation includes privatisation of its man-power. But this is an expertise area… Dredging is not available everywhere… If the employees are not in favour of privatisation, what will happen to the organisation?” asked Nayak.
“This is not any general service or financial service… This is dredging service which is a very rare field… Not everybody can do it,” he said.
Nayak said that further action by the employees will be decided in due course to decide if they would leave or stay with the company.
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