PSU stake sale: Government to prioritize companies for strategic disinvestment on July 5

Zee Media Bureau

New Delhi: The government's disinvestment in PSU companies is inching closer. An inter-ministerial meeting of secretaries, on July 5, is likely to shortlist the loss-making and sick government companies for stake sale or closure, from the list of companies NITI Aayog submitted to the Prime Minister's Office in June.

The Hindu reported that initially the government is likely to look at strategic disinvestment only in non-contentious government companies or those which will not evoke negative reaction from employees or Opposition.

Air-India, which is now reporting operating profits, and BSNL, among the top three loss-making public sector units, will not be considered, added the report.

The report, quoting sources in at least two departments, said candidates are likely to be picked from among the state-owned companies in the cement, salt, textiles, paper and antibiotics sectors, since there was no reason for government presence in these businesses. They said there was a case for selling the Centre’s stake in a number of companies including Hindustan Goa Antibiotics and Pharmaceuticals, Orrisa Drugs and Chemicals, Rajasthan Drugs and Pharmaceuticals, Sambhar Salts, Hindustan Salts Ltd, Hindustan Newsprint Ltd, Hindustan Paper Corporation, Cement Corporation of India and National Textile Mills.

Those that could be taken up for closure include ITI Ltd, IDPL and Hindustan Antibiotics Ltd, which incidentally has considerable land holdings.

Tuesday’s meeting follows deliberations in the Prime Minister’s Office (PMO) late last month, at which the Finance Ministry and NITI Aayog officials were directed to ensure that the Centre kicks off strategic disinvestment this year.

The Hindu report, attributing to a highly placed Finance Ministry official, said it was trying its best to make sure at least one public sector unit was sold off this year.

Earlier, the NITI Aayog submitted two lists to the Prime Minister’s Office: One for PSUs that can be considered for strategic disinvestment and the other of recommendations on each of the sick and loss-making government companies.

There are about 74 such companies in all. Of these, for about 25 companies in which revival plans were attempted but failed, it has suggested closure, after which their assets, especially land holdings, could be disposed off and employees offered voluntary retirement. In the remaining cases, either mergers with other public sector units or strategic disinvestment is recommended. In some companies, the NITI Aayog preferred to let revival plans run their course, before taking a call on their future.

The list of 15 PSUs in which the NITI Aayog has recommended strategic disinvestment on priority is now being examined by the Department of Investment and Public Asset management in the Finance Ministry.