Out of 257 public sector undertakings classified into 20 broad sectors, PSUs from six such sectors were in net losses for three straight years between FY 2015-16 and FY 2017-18. PSUs from telecommunication & information technology sector were the worst hit, followed by PSUs form industry & commercial goods and steel sectors, according to the data provided by Arvind Ganpat Sawant, Minister of Heavy Industries and Public Enterprises, in Lok Sabha. Net loss of PSUs from telecommunication & information technology sector extended to Rs 10,727 crore in 2017-18 from Rs 7,447 crore and Rs 6,591 crore in FY17 and FY16 respectively, according to the data.
The problem of the cash crunch in BSNL and MTNL has also forced the two PSUs to default employees’ salaries. BSNL has around 1.75 lakh employees across India, with monthly salary expenses in the range of Rs 750-850 crore while MTNL has around 22,000 employees and has a monthly salary expense of around Rs 160 crore.
Even the PSUs from trading & marketing, chemicals & pharmaceuticals and agro-based industries sectors had to settle with losses consecutively in the three years to FY18. Textile companies from the public sector also suffered cumulative loss in FY16 and FY18, according to the data sourced from Lok Sabha.
PSU losses have reached to a level where the government has initiated closure procedure and disinvestment from sick and loss-making PSUs. 19 sick and loss-making PSUs have been approved for closure by the government, which include Tungabhadra Steel Products Ltd and Indian Drugs and Pharmaceuticals Ltd.
The government has given approval for disinvestment from 28 PSUs, which also include seven loss-making entities. Such PSUs include Air India, its five subsidiaries and one JV, Salem and Bhadrawati units of Steel Authority of India Ltd (SAIL), and Hindustan Petroleum Corporation Limited (HPCL). NITI Aayog has classified PSUs into “high priority” and “low priority” based on national security, its function, etc for disinvestment.
Business restructuring, such as the formation of joint ventures, modernisation and improved marketing strategies, corporate governance, professionalisation of board of CPSEs, etc are the enterprise-specific measures taken by the administration to improve the performance of CPSEs, said Arvind Ganpat Sawant in Lok Sabha.