Why Loss-Making PSUs Under Government Scrutiny; Check Details

Why Loss-Making PSUs Under Government Scrutiny; Check Details  The government is debating the future of several money-losing public sector undertakings (PSUs) under the ministry of heavy industries, with options such as closure being considered, according to two government officials familiar with the situation. Other options include restructuring and divesting these companies, according to the officials, who spoke on the condition of anonymity. The discussions come on the heels of recent failed attempts to sell some of these loss-making entities. Scooters India and Bharat Pump and Compressors Ltd were closed down by the government last year. Tungabhadra Steel Products Ltd was closed down by the government in 2015, followed by HMT Watches, HMT Chinar Watches, and HMT Bearing in 2016. According to one of the officials cited above, the ministry received suggestions during its discussions and is working on them. "We're going over all of our options." He stated. According to the annual report of the department of public enterprises, the department of heavy industries has administrative control over 29 companies, 17 of which are still in operation. Six of the operating companies are profitable, while 11 are losing money. Five of the remaining 12 were inoperable, and seven were shut down. Fourteen of the 29 companies are in the process of being liquidated. According to the annual report, profitable companies include Engineering Projects (India) Ltd, Braithwaite, Burn & Jessop Construction Ltd, HMT Ltd, HMT (International) Ltd, Richardson and Cruddas (1972) Ltd, and Bridge & Roof Co. (India) Ltd. HMT Machine Tools, a subsidiary of HMT Ltd, Rajasthan Electronics and Instruments, Bharat Heavy Electricals Ltd (Bhel), NEPA, Hindustan Salts, Sambhar Salts, Andrew Yule and Co. Ltd, Heavy Engineering Corp. Ltd, and Cement Corp. of India are among the losers. Emails sent to the ministry of heavy industries' spokesperson on Sunday afternoon did not receive a response as of the time of publication. On February 8, 2021, Mint reported that India may consider selling stakes in Bhel, Mecon Ltd, and Andrew Yule, among other candidates. Bhel is the ministry's largest entity, with a gross asset value of 6,645 crore as of March 31, 2020. Bhel reported a profit of 14 crore in the December quarter, compared to a loss of 231 crore the previous year. Surprisingly, the company is now branching out into a new market, auto component manufacturing. It was recently included among the companies approved under the ministry of heavy industries' production-linked incentive (PLI) scheme for auto parts. The second official emphasized the government's efforts to resurrect loss-making state-run enterprises, saying, "It's a continuous process. We continue to look for ways to improve the companies that are losing money." The push for the future roadmap of the loss-making PSUs comes as the government implements a new public sector enterprise policy, under which the strategic transfer of ownership of Air India was completed after considerable effort and delay. The Centre has set a disinvestment target of 65,000 crore for the next financial year. The target for this financial year has been reduced from 1.75 trillion rupees to 78,000 crore.