The CPI(M) on Monday demanded that government rescind its decision to divest 10 per cent stake in state-owned Hindustan Aeronautics Limited, claiming that the ruling coalition was "succumbing to pressure" from Indian and foreign defence firms which could endanger national security.

"The CPI(M) demands the reversal of the HAL divestment, which could well be a precursor to deeper inroads by Indian corporates or even foreign defence majors at a later time," the party politburo said in a statement here.

It also sought a roll back of the policy of privatisation and opening up the defence industry to foreign participation, saying such measures would "lead to dismantling of India's hard-won technological self-reliance besides endangering national security".

Terming government's "excuse" that HAL needs funds for modernisation as "untenable", it said that with orders having increased by over Rs 8,500 crore and huge contracts in the pipeline including through 30 per cent offsets of several large defence purchase orders, "HAL has numerous other options for raising funds."

"It is clear the government is succumbing to pressure from corporates who are only looking for substantial and assured profits from a larger share of India's burgeoning expenditure on defence acquisitions," the CPI(M) said.

Opposing the government's divestment move, it said HAL would be the third defence PSU in which the state has off- loaded stake after Bharat Electronics Limited and Bharat Earth Movers Limited.

"HAL is not only much larger, it is also more strategic, being the only aircraft manufacturer in the defence sector and the largest in Asia," the CPI(M) said.