Friday, September 13, 2013

PSU biggies fail to meet PMO targets on capex in Q1; likely to make up in Q2

MAJOR Central Public Sector Enterprises (CPSEs) including NTPC and Coal India have failed to achieve the target for overall capital investment (Capex) in the first quarter of 2013-14, set by Prime Minister's Office (PMO). The 23 blue chip CPSEs could achieve only...
94 percent of Capex target during the period. Of these 23, only six CPSEs, viz NMDC, PGCIL, NLC, BEL, RINL and HAL had surpassed their first quarter targets, an official press release issued by the Prime Minister's Office (PMO) said.
The capex target set for the entire year is Rs 141,912 crore. The PMO has been monitoring the Capex and investment plans of selected CPSEs since 2012-13 and the purpose of this exercise was to enhance investment in the economy and use CPSEs to drive economic growth.
The cash-rich blue chip companies are under pressure from the Central government to invest more to spur the sluggish growth following the decline in GDP growth rate in the first quarter to 4.4 percent, which is slowest in the last four years.
Earlier on May 13, the PMO reviewed the investment plans of CPSEs for the financial year 2013-14. In FY 12-13, the Capex plans of 17 CPSEs were identified for monitoring. The Capex investment target for these 17 CPSEs was an ambitious Rs 141,389 crore. However, the CPSEs could achieve an investment of Rs 111,913 crore which was almost 80 percent of the target.
However, the biggies have been failing to achieve the target. During 2012-2013 as well, Indian Oil (97 percent), NTPC (94 percent) , ONGC (89 percent), Oil India Limited (83 percent), Coal India (76 percent) and NHPC (81 percent ) lagged behind in terms of Capex.
In a review meeting of the lagging CPSEs like NTPC, SJVNL, Coal India, CONCOR and NPCIL, the individual CPSEs assured that they would exceed targets by Q2 or latest by Q3 of the FY, said the statement.
In the meeting, all the secretaries of the concerned departments and the CPSE CMDs were urged to work towards fulfilling and exceeding these targets as this was extremely important for the economy. It was decided that the progress in achieving these targets would be monitored on a quarterly basis by the PMO to ensure that there are no slippages.

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