bpcl: Decline of BPCL: The government will push asset sales
Senior officials said the Shipping Corporation of India (SCI), defense PSU BEML, engineering consultancy firm PDIL and the Nagarnar Steel Mill of the country’s largest iron ore producer NMDC are among the companies for which the Center hopes to speed up the privatization process and close the deals.
Plans are also on the anvil to give new impetus to the privatization of a public bank and possibly a public insurance company, the process of which had been delayed due to a series of factors, including the Covid pandemic.
Officials said approval of the SCI spin-off was expected soon and the process of completing the sale would be expedited. “Review of the sale process has been undertaken and once approval for the split is obtained, we plan to proceed,” an official said.
Although the overall situation related to the shipping industry globally has not improved significantly, the government expects to complete the transaction successfully in the current fiscal year.
Similarly, the Center is awaiting approval for the spin-off of BEML and the Nagarnar steel plant from NMDC and is confident that once the green light from the Ministry of Public Affairs is given, the transactions can accelerate. The sale of PDIL is also expected very soon, the official said, adding that substantial progress had been made so far.
The government is also forging ahead with the closure of state-owned companies where the sale process has repeatedly encountered obstacles and a lukewarm response. The new closure guidelines provide sufficient flexibility to administrative departments to proceed with the closure of those PSUs that have long been on the privatization list.
“Different ministries are closing some of the UAPs that were on the privatization list and where buyer interest has been minimal. Some of them have already been closed and we hope a few will be closed soon as well,” an official said. The Covid pandemic emerged as a major impediment to the Centre’s privatization drive and weighed on a number of key stake sales as global travel was affected. But now, the opening up across the world has raised hopes of speeding up the process.
The Center is confident of achieving the divestment target of Rs 65,000 crore set for the current financial year. So far, it has raised Rs 24,047 crore through the sale of assets in state-owned companies, and sales of residual stakes in Hindustan Zinc and Paradeep Phosphates should bring it closer to the target.