BPCL sale will dent govt's energy justice, social schemes: Unions

NEW DELHI: Privatising India’s second-largest oil company

BPCL

will dent the government’s energy justice programme and social obligation schemes as well as weaken the security of fuel supplies to defence forces — the main factor that had driven the Centre towards nationalisation of private oil companies after the 1971 war with Pakistan, the officers’ unions of public sector bluechips said on Monday.


According to Mukul Kumar, convenor of Federation of Oil PSU Officers (FOPO) and Confederation of Maharatna Companies (COMCO) representing 70,000 officers of top-wrung PSUs, the unions were not against private competition. “They (private players) should not be handed assets built up over years on a platter. Let them come and set up their own infrastructure. We don't have any problem in (successfully) competing against them,” he told reporters.

Ruling out strike by the officers, Kumar said they will make a representation to the PM to present the facts and explain their stand. “A private operator will be driven only by considerations of profit and not be bothered about delivering the government’s social obligatory schemes or reaching fuel to the remote or difficult areas”.

For example, he said a privatised BPCL will not be under the reservation policy for SCs, STs, OBCs, kin of martyred defence personnel or physically challenged while giving jobs, petrol pumps or LPG distributorship; or mandatory 4% procurement of total purchases from SC/ST entrepreneurs.

Moreover, the private sector owner will not invest in social schemes such as Ujjwala as they are a big drag on financial and human resources. BPCL spent around Rs 8,000 crore to issued two crore LPG connections to poor households free of cost under the scheme. They said over 8 crore LPG consumers of BPCL who get subsidy and subsidised diesel supply to fishermen will also suffer. The private operator

A statement issued by the two umbrella bodies later also questioned the reason for privatising BPCL despite being on the “Fortune 500 list for 15 years, sound finances, efficient management that pays over Rs 17,000 crore as dividend to the Central government, has has 6,000 acres of land across India, of which 750 acres is in Mumbai alone valued for crores of rupees”.

It said the very reason for nationalisation of

petroleum

sector was to secure supply to the Army and to common people by putting these assets with the government. It pointed to how PSU oil companies have proven to be a saviour in trying times during floods in Kashmir, Uttarakhand and Kerala as well as natural calamities hitting other parts of the country.

BPCL was created by nationalising Burmah Shell in 1974 after the private firm refused to co-operate with the Army in supplying fuel to the remote battlegrounds during the 1971 war. HPCL was created by nationalising Esso and Caltex. The government last year sold its holding in HPCL to state-run ONGC, retaining India’s third-largest oil company under its fold.

The Cabinet had last month approved the sale of the government's entire 53.29% stake in BPCL, arguing the resources unlocked by the strategic

disinvestment

would be used to finance social sector programmes benefiting the public.

Citing past privatisation moves where the new buyer asset stripped the companies they acquired, Kumar said the government should empower the PSUs and give them level playing field to compete with the private sector. “This (privatisation of BPCL) is suicidal for the country,” he said.