PremiumA panel of Ministers, comprising Finance Minister Nirmala Sitharaman and Road Transport Minister Nitin Gadkari, will take the final call on the number of PSUs that will be retained in each of the strategic sectors, DIPAM Secretary Tuhin Kanta Pandey said
NEW DELHI : A panel of Ministers, comprising Finance Minister Nirmala Sitharaman and Road Transport Minister Nitin Gadkari, will take the final call on the number of public sector companies that will be retained in each of the strategic sectors, DIPAM Secretary Tuhin Kanta Pandey said.
The government in the Budget unveiled the Disinvestment/Strategic Disinvestment Policy and identified four sectors -- Atomic energy, Space and Defence; Transport and Telecommunications; Power, Petroleum, Coal and other minerals; and Banking, Insurance and financial services -- as strategic sectors, where bare minimum CPSEs would be retained.
The Central Public Sector Enterprises (CPSEs) in other sectors would be privatised.
NITI Aayog would be working on the preliminary list of CPSEs, which could be taken up for strategic disinvestment.
The Secretary in the Department of Investment and Public Asset Management (DIPAM), which manages government equity in public sector companies, said that the strategic disinvestment policy is an important directional shift and gives a broad idea to the private sector about which companies could be up for sale.
"The idea is bare minimum will be retained. There the GoM has been constituted, which is an Alternative Mechanism (comprising) Finance Minister, Road Transport Minister and Minister from the Administrative Ministry. The Alternative Mechanism will decide which is the bare minimum that would be retained in any particular sector.
"The strategic sectors have been classified in four broad baskets -- national security, critical infrastructure, energy and minerals and financial services," Pandey told PTI in an interview.
He said bare minimum to be retained means rest can be privatised, or can be closed, or merged, or made subsidiary of another CPSEs.
"So, there is a very big restructuring of the public sector that is taking place. This is a policy which will operate over a period of next few years. That opens up the work of the government and indicates to the private sector what the government has in mind. We need private sector interest to revive in order to do capital formation," Pandey added.
The government has budgeted ₹1.75 lakh crore from stake sale in public sector companies and financial institutions, including two PSU banks and one general insurance company, in the next fiscal year beginning April 1.
For the current fiscal, the revised target has been set at ₹32,000 crore, lower than ₹2.10 lakh crore set in the previous Budget. The COVID-19 pandemic has impacted the government's CPSE stake sale programme in the ongoing fiscal.
The government is targeting to conclude strategic sale of BPCL, Air India, Shipping Corporation of India, Container Corporation of India, IDBI Bank, BEML, Pawan Hans, Neelachal Ispat Nigam Ltd, in the next fiscal. Besides, Initial Public Offering of LIC too would be launched and a strategic sale process of two PSU banks and one general insurance company would be initiated.
The Budget has said that a revised mechanism would be brought in to ensure timely completion of closure of sick or loss making CPSEs.
"Closure is taking a lot of time, DPE (Department of Public Enterprises) is working on how closure can be done quickly," Pandey said.
The Union Cabinet last month approved closure of loss-making state owned Scooters India.
In 2018, the government had invited expression of interest (EoI) to sell its entire stake with transfer of management control in loss-making Scooters India. The Centre made several efforts in the past to find buyers for Scooters India and nurse the ailing firm back to health, but they have not yielded results.
This story has been published from a wire agency feed without modifications to the text. Only the headline has been changed.
