The Uttar Pradesh government on Tuesday decided to withdraw a privatisation plan for electricity distribution companies, after nearly five hour meeting with protesting employee unions which began an indefinite strike a day ago.

As per the agreement signed after the meeting held by state power minister Shrikant Sharma and its finance minister Suresh Khanna, Uttar Pradesh agreed to take back the privatisation proposal of Purvanchal Vidyut Vitaran Nigam Ltd, which supplies electricity to 80 lakh consumers including in important constituencies of Varanasi, Gorakhpur and Prayagraj.

The agreement said the state power distribution companies will strive to improve power supply and operational efficiencies within the existing framework and any privatisation proposal in future will be made after taking the employees and authorities in confidence.

Sharma will hold monthly review meetings till January 15, to take stock of progress in the distribution utilities, the agreement said.

The government and the employee unions also agreed to take measures to make the power distribution areas corruption-free, and bring billing and collection efficiencies. The government also agreed that no action will be taken against protesting power department employees and withdraw all FIRs registered in the past two days.

The employees in the power department of the Uttar Pradesh government began an indefinite work boycott on Monday in response to a call given by the UP Vidyut Karmachari Sanyukt Sangharsh Samiti to protest against the proposed privatisation of the discom, which resulted in long power cuts in many parts of the state.

The Allahabad University in Prayagraj deferred online graduation and post-graduation exams till October 20 due to intermittent power supply.

An agreement was reached between the Sharma and the Power Employees Sangharsh Committee late on Monday as per which, it was agreed to postpone privatisation of Purvanchal power utility till March next year.

Based on this the Power Employees Sangharsh Committee had announced the withdrawal of the movement. However, Uttar Pradesh Power Corp Ltd chairman Arvind Kumar refused to sign the agreement, after which the power employees decided to continue with their protests.

The Uttar Pradesh Power Corp had last month initiated data collection exercise from all six electricity zones of Purvanchal distribution company – Varanasi, Gorakhpur, Prayagraj, Basti, Mirzapur and Azamgarh – to work out its assets and liabilities. The discom had also begun an exercise to appoint consultants to carry on the privatisation process.

The Union power ministry has recently floated a draft standard bidding document for privatisation of state-owned power distribution companies.