GoM mooted to put sick PSU revival on fast track

A group of ministers is being set up to reduce the time taken by different ministries in initiating the revival plan of sick central public sector enterprises and then implementing them.

A group of ministers (GoM) is being set up to reduce the time taken by different ministries in initiating the revival plan of sick central public sector enterprises (CPSEs) and then implementing them. On an average, the administrative ministries take 3-4 years to execute the revival plans of CPSEs.

The proposal has been mooted by heavy industries and public enterprises ministry, which is controlling most of the sick CPSEs. According to the website of Board for Reconstruction of Public Sector Enterprises (BRPSE), of 73 sick firms 27 are administered by the department of heavy industry. Some of the these companies are HMT, HMT Watches and HMT Chinar Watches.

?The ministries are generally slow. The main reason for the delay may be the time taken to negotiate with the company on the government assistance and moving the Cabinet, which involves taking other ministries on board. But the fact of the matter is that we should act fast in the interest of the sick companies and employees. So we have proposed a GoM as a single platform for the revival of firms,? Arun Yadav, state minister for heavy industries and public enterprises, told FE.

Department of public enterprises secretary Bhaskar Chatterjee and BRPSE chairman Nitish Sengupta also confirmed the development.

?We are working on the proposal to minimise the time in the revival,? Sengupta said. A senior official in the ministry told FE, ?We will soon submit a Cabinet note on setting up the group. The final call will be taken by the Cabinet?.

Most CPSEs don’t have the autonomy to take management decisions and have to take prior government nod to invest in projects or companies. The government has to be approached for issues as miniscule as the overseas travel of chairman of a CPSE. In this situation, experts feel that the government holds primary responsibility for the sickness of CPSEs.

The long sickness of some CPSEs have also led to them asking for liquidation. In March 2009, the then chairperson of Indian Drugs and Pharmaceutical, Jayashree Gupta had asked the government to either take a decision on its revival or liquidate it.

Incidentally, the company’s revival plan was lying with a group of ministers headed by defence minister A K Antony since 2007.

This article was first uploaded on December two, twenty ten, at thirty-eight minutes past eleven in the night.