New Delhi: After BPCL (Bharat Petroleum Corporation Ltd), CONCOR (Container Corporation of India), SCI (Shipping Corporation of India) and Air India, the government has given "in-principle" approval for the privatisation of 24 PSUs, including subsidiaries, units, and joint ventures. In line with its policy thrust, the government will be looking to offload majority stakes in PSUs and transfer the management control to a strategic player, Minister of State for Finance Anurag Singh Thakur said in a written response in the Lok Sabha on Monday. The decision comes in the backdrop of the government releasing PIMs (Preliminary Information Memorandum) for the privatisation of Air India and BPCL.
Thakur said that the government follows a policy of strategic disinvestment of CPSEs, which are not in "priority sectors." "For this purpose, NITI Aayog has been mandated to identify such CPSEs based on the criteria of (i) National Security; (ii) Sovereign function at arm's length, and (iii) Market Imperfections and Public Purpose," Thakur said. The government had stated that the profitability of a company, or the lack of it, is not a criterion for disinvestment.
Strategic disinvestment or privatisation of PSUs is being guided by the basic economic principle that the government should discontinue in sectors, where competitive markets have come of age and economic potential of such entities may be better discovered in the hands of strategic investor due to various factors such as infusion of capital, technological up-gradation and efficient management practices; and would thus add to the GDP of the country, said the minister.
The news comes as the government races against time to meet its disinvestment target of Rs 65,000 crore before March-end. For financial year 2019-20, the government has set for itself a disinvestment target of Rs 2.1 lakh crore. Three big disinvestments that the Centre will be relying on to raise funds in the next fiscal year are: LIC IPO, Air India and BPCL.
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