Lok Sabha Question No. 35 (UNSTARRED), answered on 2020-09-14
Subject: Disinvestment of PSUs
Ministry: FINANCE
Asked by: P. Velusamy

## GOVERNMENT OF INDIA MINISTRY OF FINANCE

## DEPARTMENT OF INVESTMENT AND PUBLIC ASSET MANAGEMENT

## LOKSABHA

## UNSTARRED QUESTION NO. 35

TO BE ANSWERED ON MONDAY, SEPTEMBER 14, 2020

BHADRAPADA 23, 1942 (SAKA)

## Disinvestment of  PS  Us

## 35.  SHRI VELUSAMY P, HON'BLE MP

Will the  Minister  of FINANCE be pleased to state:

- a)  the details of  steps taken by the Government to control the slow-down of  the economy and  to raise  cash  under  the  reform drive;
- b)  whether  the Government is having any proposal to disinvest or sell the Public Sector  Undertakings (PSUs);
- c)  if so, the details thereof;
- d)  whether the Government has received any recommendation from Niti Aayog listing  the companies to be disinvested;
- e)  if so, the name  of the companies to be listed for  disinvestment; and
- f)  the steps taken by  the Government  to safeguard the  interests of the  employees?

## ANSWER

## THE MINISTER OF STATE IN THE MINISTRY OF FINANCE

## (SHRI ANURAG SINGH THAKUR)

(a)  : Government oflndia implemented several measures to mitigate the negative impact of  COVID-19 on the economy which, inter-alia, include:

- Relief  measures for households such as in-kind (food;  cooking gas) and cash  transfers  to  senior  citizens,  widows,  disabled,  women  Jan  Dhan Account holders, farmers; insurance coverage for  workers in the healthcare sector;  wage increase for MGNREGA workers and support for building and  construction  workers;  collateral  free  loans  to  self-help groups  and reduction in EPF contributions under  Pradhan Mantri Garib Kalyan Yojana and  employment provision  for migrant workers  under Pradhan Mantri Garib Kalyan Rojgar  Abhiyaan, amongst  others;
- Relief  measures for MSMEs such as collateral-free lending program with 100 percent credit guarantee,  subordinate debt for stressed MSMEs with partial guarantee, partial credit guarantee scheme for  public  sector  banks on

borrowings of  non-bank financial companies, housing finance companies (HFCs), and micro finance institutions, Fund of  Funds for equity infusion in  MSMEs, additional support  to farmers via  concessional credit, as well as a credit  facility for  street  vendors (PM SY ANidhi),  amongst  others;

- Regulatory and compliance measures  such as postponing tax-filing and other compliance deadlines, reduction in penalty interest rate for overdue OST filings, change in government procurement rules,  faster clearing of MSME dues, IBC related relaxations for  MSMEs, amongst  others
- Structural  reforms announced as part of  the Atmanirbhar Package which, inter alia,  include deregulation of  agricultural sector, change in definition of  MSMEs, new PSE policy, commercialization  of  coal mining, higher  FDI limits in defence and space sector, development of  Industrial Land/ Land Bank and Industrial Information System, revamp of  Viability Gap Funding scheme for social infrastructure, new power  tariff  policy and incentivizing States to undertake sector  reforms.

(b) and (c) : The Government follows a policy of  disinvestment  through Strategic Disinvestment  and Minority stake sale.

Strategic Disinvestment implies substantial  sale of  Government shareholding of CPSEs,  which  are  not  in  priority  sector,  along with  transfer of  management control. 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.  Besides, in certain other CPSEs, the Government  carries  out disinvestment  of minority  stake  without transfer  of management control from time to time through various SEBI-approved methods such as Initial  Public Offer(IPO), Offer for Sale (OFS), Buyback of  shares and Exchange  Traded  Funds  (ETFs)  offers, depending  upon  prevailing  market conditions.

(d) and (e): Based on the criteria laid down by NITI Aayog, the Government  has 'in principle'  approved  strategic disinvestment  in  34 cases  since  2016,  out of which strategic disinvestment in 8  cases has been completed; 4 cases halted as CPSEs are under consideration for closure; 2 cases held up due to litigation; and remaining 20 transactions are at  various stages. The  details are at Annexure.

(f) Upon strategic disinvestment, the management  control of  the company shall be in the hands of  strategic buyer. While deciding the terms and conditions of  the strategic sale,  employees' concerned are suitably addressed through appropriate provisions made in the Share Purchase Agreement (SP  A) to be signed by the Government  with the strategic  buyer.

## List of  CPSEs,  including Subsidiaries, units and Joint ventures, for which Government "  "  " "T " " w " " ® has given in-principle' approval for  strategic  disinvestment.

## a) Transactions Completed

|   S.No. | Name ofCPSE                                               |
|---------|-----------------------------------------------------------|
|       1 | Hindustan Petroleum Corporation Limited (HPCL)            |
|       2 | Rural Electrification Corporation Limited (REC)           |
|       3 | Hospital Services Consultancy Corporation (HSCC)          |
|       4 | National Project construction corporation (NPCC)          |
|       5 | Dredging Corporation of India Ltd. (DCIL)                 |
|       6 | THDC India Limited (THDCIL)                               |
|       7 | North Eastern Electric Power Corporation Limited (NEEPCO) |
|       8 | Kamrajar Port Ltd. (KPL)                                  |

## b)  CPSEs under  consideration  for  closure

|   S.No. | Name ofCPSE                       |
|---------|-----------------------------------|
|       9 | Hindustan Fluorocarbon Ltd. (HFL) |
|      10 | Scooters India Limited            |
|      11 | Bharat Pumps & Compressors Ltd    |
|      12 | Hindustan Prefab Limited (HPL).   |

## c)  Transaction held up as cases under  litigation

|   S.No | Name ofCPSE                                 |
|--------|---------------------------------------------|
|     13 | Hindustan Newsprint Ltd                     |
|     14 | Kamataka Antibiotics & Pharmaceuticals Ltd. |

## d)  Transactions in process

|   S.No | Name ofCPSE                                                              |
|--------|--------------------------------------------------------------------------|
|     15 | Project & Development India Ltd.                                         |
|     16 | Engineering Project (India) Ltd.                                         |
|     17 | Bridge and Roof Co. India Ltd.                                           |
|     18 | Plants/Units of Cement Corporation of India Ltd (CCI)                    |
|     19 | Central Electronics Ltd.                                                 |
|     20 | Bharat Earth Movers Ltd. (BEML)                                          |
|     21 | Ferro Scrap Nigam Ltd.(sub.)                                             |
|     22 | Nagamar Steel Plant ofNMDC                                               |
|     23 | Alloy Steel Plant, Durgapur; Salem Steel Plant; Bhadrawati units of SAIL |

·

|   24. | Pawan Hans Ltd.                                                                                                                                   |
|-------|---------------------------------------------------------------------------------------------------------------------------------------------------|
|    25 | Air India and its five subsidiaries and one JV.                                                                                                   |
|    26 | HLL Life Care Ltd.                                                                                                                                |
|    27 | Indian Medicine & Pharmaceuticals Corporation Ltd. (IMPCL)                                                                                        |
|    28 | Various Units of Indian Tourism Development Corporation (ITDC)                                                                                    |
|    29 | Hindustan Antibiotics Ltd. (HAL)                                                                                                                  |
|    30 | Bengal Chemicals and Pharmaceuticals Ltd. (BCPL)                                                                                                  |
|    31 | (a) Bharat Petroleum Corporation Ltd(except Numaligarh Refinery Limited) (b) BPCL stake in Numaligarh Refinery Limited to a CPSE strategic buyer. |
|    32 | Shipping Corporation of India (SCI)                                                                                                               |
|    33 | Container Corporation of India (CONCOR)                                                                                                           |
|    34 | Nilachal Ispat Nigam Limited (NINL)                                                                                                               |