The government is considering a proposal to close down two more sick central PSUs -- a unit of HMT arm and Tyre Corporation of India Ltd (TCIL), said Heavy Industry and Public Enterprises (HI & PE) Minister Anant Geete on Friday. He also stated that the government is not planning to use the surplus land available with the central PSUs to set up a land bank.
“We are discussing these proposals (to close down a HMT unit and TCIL)… Some (CPSUs) were approved for closure earlier. We have prepared individual proposals for them,” Geete said at an event organised by CII.
The Union Cabinet’s in-principle approval is already in place for closing down sick CPSUs including HMT Watches, HMT Chinar Watches, HMT Bearings, Hindustan Cables and Tungabhadra Steel Products. As the minister said, individual proposals for closure have been prepared by the HI & PE Ministry, which will soon be placed before the Cabinet for its final approval.
Geete, however, did not disclose more details, including the specific HMT unit being considered for closure. Earlier, the government was planning to revive TCIL through the disinvestment route or joint venture. The minister also said, “We (the government) are not going in for disinvestment of any (loss-making central PSUs).”
On the topic of disinvestment of PSUs, including loss-making ones, finance minister Arun Jaitley had, on earlier occasions, said that the government “was not averse to strategic sales,” adding that it would consider strategic sales “wherever possible.” Through the strategic sale, the government aims to transfer management control of certain PSUs to the private sector. However, this does not include sale of the government’s residual stake in some non-government companies.
In addition to the aim of raising around Rs 41,000 crore via disinvestment of minority stakes (ranging from 5-15%) in certain listed PSUs, the government is also targeting garnering around Rs 28,500 crore through strategic sales of PSUs.
Referring to the proposed National Policy on Capital Goods, which among other things aims a long term, stable and rationalized tax and duty structure to ensure cost-competitiveness of the sector, Geete said it "will be finalised within 1-2 months and sent to the Cabinet for approval".
On the problems faced by the Indian steel industry due to intense competition from countries such as Korea and China, he said the government will take necessary steps to enable the domestic industry to face such competition.
On the Volkswagen issue, the minister said the government has already issued a notice to the company after testing agency ARAI found "significant variations" in on-road emission levels in diesel models of Audi A4 and Audi A6 as well as Jetta and Octavia in India.
