Disinvestment target: 26 government companies will be sold soon, the government is preparing to meet the disinvestment target
Disinvestment
Disinvestment target: Strategic sale of units of Central Public Sector Undertakings (CPSEs) for which Cabinet approval has already been completed will be completed soon. The Union Cabinet has given in-principle approval for strategic disinvestment of 35 public sector companies and their units/subsidiaries since 2016. Of these, nine transactions have been completed. That is, 26 companies will be sold. The Finance Ministry says that such units for which the Cabinet’s nod has been received, their strategic sale will be done under the guidelines set by the respective public sector undertaking DIPAM.
The sale process will be completed by DIPAM
The Finance Ministry said that the units for which EoIs have been issued for strategic sale will be sold by the Department of Investment and Public Asset Management (DIPAM). According to an office memorandum put out by DIPAM on June 1, any public sector undertaking that has got the approval of the Cabinet Committee on Economic Affairs (CCEA) or the Alternative Arrangement (AM) for strategic sale, their sale process will be taken to the public sector. companies will be carried forward as per the new guidelines. The Union Cabinet had on May 18 empowered public sector undertakings to wind up units/subsidiaries, strategic or minority stake sale. This has given greater autonomy to the public sector undertakings. After this, DIPAM has taken out this office memorandum.
Open and competitive bidding will be done
DIPAM said that the procedure to be followed for strategic disinvestment transactions/closures by PSUs should be based on the principles of open and competitive bidding and should be in compliance with the laid down guidelines. Deepak guided principles will be issued for such strategic disinvestment. At the same time, the principles of Department of Public Enterprises (DPE) will apply for the closure of a unit. Public sector companies will have to apply to DIPAM through their respective ministry for sale of their units or subsidiaries. The Alternative Mechanism (AM) will provide in-principle approval for disinvestment. The AM will be attended by ministers from the concerned ministries of finance, road transport and highways and public sector undertakings.
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