Yes to stake sale in loss-making Bharat Pumps

IN A series of economic decisions Wednesday, the Centre approved strategic divestment of Bharat Pumps & Compressors Ltd (BPCL) and also gave a nod to the consortium of IOC, Oil India and BPCL to buy a stake in two Russian oil fields for an aggregate of US$ 3.14 billion.

The CCEA also approved Rs 2,256 crore for an IT project, Saksham, meant to integrate tax systems of the Central Board of Excise and Customs (CBEC) with the Goods and Services Tax Network (GSTN).

Giving the green signal to its first strategic disinvestment, the Cabinet Committee on Economic Affairs (CCEA), under the chairmanship of Prime Minister Narendra Modi, gave “in-principle” approval for strategic disinvestment of Allahabad-based BPCL. The government will sell a substantial portion of its holding in the company and also give up management control.

The CCEA also decided to provide financial assistance amounting to Rs 111.59 crore as non-plan loan to the company, to help it meet statutory dues such as provident fund and gratuity of retired employees and outstanding dues of CISF.

“It will motivate employees and improve the performance of the company. This will put an end to further legal complications and penal action against the company,” a government statement said.

The company had been incurring losses for several years now. According to its financial statement, it incurred a loss of Rs 5.24 crore in the fiscal ended March 2014. The loss in the year 2012-13 stood at Rs 27.9 crore.