Friday, September 9, 2016

Soon, government to announce norms for sick PSU asset sale

THE NDA Government will soon come out with detailed guidelines for sale of land and other assets of state-owned sick and loss making PSUs which are being considered for closure. “When a company is going to close down a particular unit assets have to be disposed of. Specific guidelines are under issue by the Department of Public Enterprises,” a senior government official was quoted as telling a news agency. Assets like building, plant and machinery of sick...
Central Public Sector Enterprises (CPSEs) would be sold through e-auction.
In case of free-hold land, the state governments will be offered to buy it at the prevailing market price.
“If it is a free-hold land in the name of the company, they have to first approach the state government which may purchase the land for public purpose. But the price of that should be the present day acquisition cost,” the official added.
Earlier, NITI Aayog identified 32 loss-making companies for strategic disinvestment, including central public sector enterprises (CPSEs) such as Bharat Pumps & Compressors, Tyre Corporation of India, Central Inland Water Transport Corporation and Bengal Chemicals & Pharmaceuticals, among others. Of the 32 companies, 10 could see strategic disinvestment right away while for the other 22 the suggestion is to revive while retaining a subsequent option for strategic disinvestment.
Of the total 74 loss-making companies 26 have been identified for closure or winding up, five for long-term lease or management contract, three have been proposed to be merged with the parent company while two have been identified for maintaining status quo.
Earlier, kicking off PSU reforms, NITI Aayog submitted to the Prime Minister's Office (PMO) a roadmap for closure and strategic sale of government stake in some public sector units.
Under the roadmap, the government think tank dealt with two sets of issues — one pertains to decision regarding sick firms which have been making losses, while the second is disinvestment, or strategic sale where government wants to reduce its stake.
Government has set a disinvestment target of Rs 56,500 crore for this fiscal. Of this, Rs 36,000 crore is to come from minority stake sale in PSUs and Rs 20,500 crore from strategic sale.
Government began the disinvestment programme for the current fiscal with 11.36 per cent stake sale in NHPC. The government raised Rs 2,700 crore through the process.
It has lined up as many as 15 PSUs, including Coal India, NMDC, MOIL, MMTC, National Fertilisers, NALCO and Bharat Electronics, for stake sale in current fiscal.

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