1. Cabinet clears sale of 20 PSUs; to pare stake in BEML to 28%, exit Scooters India, Pawan Hans, more

Cabinet clears sale of 20 PSUs; to pare stake in BEML to 28%, exit Scooters India, Pawan Hans, more

The government on Thursday gave in-principle approval to kick off the process for strategic sales in about 20 PSUs/units, including profitable ones, to garner resources for sustaining the momentum of its spending in the current year and next.

By: | New Delhi | Published: October 28, 2016 6:37 AM
“The recommendations of the NITI Aayog with regard to both disinvestment and strategic sale came up for consideration. In principle the Cabinet has approved the recommendations with regard to some of the units,” finance minister Arun Jaitley said (Reuters) “The recommendations of the NITI Aayog with regard to both disinvestment and strategic sale came up for consideration. In principle the Cabinet has approved the recommendations with regard to some of the units,” finance minister Arun Jaitley said (Reuters)

The government on Thursday gave in-principle approval to kick off the process for strategic sales in about 20 PSUs/units, including profitable ones, to garner resources for sustaining the momentum of its spending in the current year and next. According to the plan being drawn up, the government would pare its stake in profit-making BEML from the present 54% to 28%, while it will fully exit Scooters India, Pawan Hans, Hindustan Newsprint, Ferro Scrap Nigam, Bridge & Roof Company India, Projects & Development India, Central Electronics and Hindustan Prefabs.

These apart, identified units of Cement Corporation of India, the Nagarnar steel plant of NMDC and Bhadrawati, Salem and Durgapur plants of SAIL would be sold.

Three PSUs — Hospital Services Consultancy Corporation, National Project Construction Corporation and Engineering Projects India — would be sold to PSUs in the same lines of business.

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The stakes sales, sources said, would happen through a two-stage auction process, comprising technical and financial bids, as recommended by a core group of secretaries on disinvestment. “The recommendations of the NITI Aayog with regard to both disinvestment and strategic sale came up for consideration. In principle the Cabinet has approved the recommendations with regard to some of the units,” finance minister Arun Jaitley said, without naming the PSUs. Analysts said the government was unlikely to meet this year’s strategic sale target of R20,500 crore, as the process of these sales would take six to eight months on an average.

After examination by the department of investment and public asset management and the administrative ministries for each PSU concerned, the cases would be considered separately, the minister said. “So in principle it has been approved. Specific cases would now come up after a detailed examination as to how it is to be done in each case and the details with regard to the units concerned will be furnished at that stage. This list does not include PSUs for closure,” Jaitley said.

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