The Centre Is Keen To Shut Down 15 PSUs That Are Making Loss
September 27th, 2016
The Central Government has made up its mind to shut down 15 loss-making public sector units of the country as a part of the disinvestment exercises. The cabinet has already cleared the proposals on closure of five units., while opting to go against internal advice and revive three state-run companies.
According to Times of India, there were another half-a-dozen sick public sector companies, which had been identified by NITI Aayog for shut down, but it remained uncertain amid hectic lobbying by ministries, which want to keep them alive in what may be an effort to protect their turf.
Nripendra Misra, the Principal Secretary in PMO held meetings with different ministries. Subsequently, NITI Aayog classified the PSUs into two segments. One section of the list for closure of PSUs and the other one comprising the PSUs, in which the Centre will dilute its stake.
The petroleum ministry has opposed the shutting down of HPCL Biofuels. The textile ministry has managed to postpone the issue of closure of the ailing British India Corporation and Elgin Mills.
Heavy Industry Ministry has cleared the proposal on closing down the units of HMT, while the Shipping Ministry has agreed to close down Central Inland Transport Corporation. According to Mr Misra, these companies have not seen significant addition to manpower in recent years and existing employees are being given a liberal severance package.
Niti Aayog submitted a report on closure, revival and sale of 74 sick and unprofitable PSUs in June 2016. Now, Finance Ministry is working on it. Out of 74, the Aayog had suggested status quo in case of two PSUs, strategic disinvestment of 10, plan for revival with option for strategic disinvestment for 22, transfer of ownership of six, merger of three, long term lease of five and closure of 26.