Divestment road map likely by Aug 7; PSUs being shortlisted

Divestment road map likely by Aug 7; PSUs being shortlisted
The Financial Express, July 17, 2009, Page 12

Praveen Kumar Singh, New Delhi

The Centre is likely to finalise the blueprint for disinvestment by August 7, the minister of state for heavy industries and public enterprises, Arun Yadav, has said, adding that his ministry is in close talks with the finance ministry to select the best out of “many companies” that have the potential for disinvestment.

“There are many companies in which the government can sell equity. The process of selling the stake in NHPC Ltd and Oil India Ltd is on and the initial public offers of the two will be floated in the next two months. The government will finalise the names of the other companies and the right time for disinvestment in the next 2-3 weeks,” Yadav told FE.

When asked about the companies that may be under consideration, Yadav said, “It is too early to talk about that. The picture will be clear soon”. The decision naming the companies is to be taken up by the department of disinvestment, under the finance ministry, he said. However, the ministry of heavy industries and public enterprises is discussing the issue with the finance ministry “on daily basis”, Yadav added.

The statement comes two days after finance minister Pranab Mukherjee told the Lok Sabha that the process of preparing a road map on disinvestment has been initiated. “My ministry has initiated discussions with other ministries and departments for identifying public sector undertakings (PSUs) where a portion of government shareholding can be sold and for the issue of fresh equity by the public sector undertakings to meet their fund requirements. The details are being worked out and would be announced in due course,” he had said on July 14.

Different ministries have already said that disinvestment is important for their PSUs. Coal minister Sriprakash Jaiswal had declared last month that he is pitching for divesting up to 10% in companies like like Coal India Limited and Neyveli Lignite, which are under his administrative control. Heavy industries minister Vilasrao Deshmukh had also said in June that the government is mulling to sell stake in the already-listed Bharat Heavy Electricals Limited (Bhel). Bhel is the only navratna company under his ministry.

Outlining his ministry’s priority, Yadav said, “The ministry is serious about the revival of sick PSUs and increasing the efficiency of profit-making ones”. He announced that 17 out of 35 PSUs under the department of heavy industry are profitable. Another 15 undertakings, including Tyre Corporation of India and NEPA Limited, are either sick or on the verge of being declared sick.