Let us discuss the package in details. The 'bail out package' has been formulated at the instance of the Union Finance Ministry although the Finance Minister for mysterious reasons has tried to keep it a guarded one despite questions having been raised repeatedly in Parliament. But the IDBI Chairman Mr. G. Gupta in a letter to the Union Finance Ministry dated January 25 gave details of the package. The letter, was however leaked to the newspapers and printed. It is known that the IDBI has selected a group of 14 private sector steel companies as probable beneficiaries of the package. Among these are the Essar Steel Company owned by the Ruias the Ispat Group o f the Mittals, Jindal Iron, Lloyd Steel, Rajinder Steel, Usha Ispat, Nilachal Ispat etc. According to the IDBI estimate the financial institutions owned mostly by the Government have till January this year advanced loans totalling Rs. 14,000 crores of this amount the IDBI share of loans advanced amounted to as high as Rs. 4,350 crores. Even after release of so large amounts of loans, the steel projects have remained incomplete. There have been cost and time overruns. Since there was no prospects of the loans being refunded, the Finance Ministry again came out with 'bail out package' not knowing if the additional funds would also go down the drain. As per the new bail out package, from February onwards this year the major financial institutions sanctioned fresh loan of Rs. 5,200 crores to these 14 companies although there are evidences to show that funds worth hundreds of crores of have been diverted from the recipient companies to other companies of the industrialists or they have used the funds for purposes other those stipulated in the agreement.

What then was the reason for the Finance Ministry again formulating a package for the errant industrial houses? The fact of the matter is that these industrialists are either close to influential Ministers of the Vajpayee Government or provider of huge amounts the election fund of the BJP. Among them the Mittals are very close to the Prime Minister. Mr. Promode Mahajan is learnt to have taken the extra initiative to see to it that Mittals get the loans at any cost. On the other hand, the Ruias are known to be very chummy with Mr. L.K. Advani. The Mittals and the Ruias have allegedly cornered the lion's sahare of the FI funds. The others in the race are also equally powerful.

Thousands of crores of rupees of people's money deposited with the FI's have by means not always fair, been given as loans to a handful private sector industrialists whose only credential is that is that they are close to the Prime Minister or a few other Ministers. One such example is enough to show how in judiciously government money is spent by the BJP led government. What is the condition of public sector IISCO when public in only is allocated liberally for the private sector? Situated in Burnpur, West Bengal, the plant is sick for lack of government attention.

Despite repeated attempts made by Chief Minister Jyoti Basu and the people have voiced their demand for reviving or modernising the prestigious steel plant, the Union Government has so far turned a deaf ear to the requests. IISCO was sent to the BIFR in 1994. The BIFR has selected the IDBI as the operating agency for reviving or modernising the IISCO. But the IDBI though is most active in preparing projects for the private sector steel plants it has not so far taken any initiative to prepare a plan for the IISCO. At last with the help of the Russian government Rs. 2107 crore revamp project is being prepared. Although the agreement between India and Russia was signed in 1998 no concrete steps have so fare been taken because of the financial crisis gripping the Russian economy. Again, after the IISCO revamp issue was transferred to the BIFR, the Union Government has stopped sanctioning any fresh funds for keeping the operations of the plant going. However much the BJP or the Trinamul Congress leaders shed tears about the development of West Bengal and talk of their fraternity with the workers of the State they have done little concrete for the modernisation of the IISCO. The Union Government has sanctioned only Rs. 10 crores for the IISCO. The Union Government has sanctioned only Rs. 10 crores for the IISCO in 1998-99. The amount is earmarked for facilitating the voluntary retirement scheme.

Not only IISCO, the government of India may be making moves to wind up the public sector apex body in the steel sector, SAIL. The BJP-appointed firm Mackinsey has even recommended that SAIL be wound up or its shares disinvested. Recommendations have been made by the firm to sell off Salem Steel Plant in Chennai and the Aloy Steel Plant, in Durgapur. The BJP-led government is learnt to be favorable poised to such proposals.