Govt may fail to meet asset-sale goal again
NEW DELHI: The government may fail to meet its asset-sales target again as a combination of reasons, including poor market sentiments and legal challenges, has delayed planned disinvestments of state-run companies.
Disinvestments of Shipping Corp. of India, BEML Ltd, NMDC Ltd’s Nagarnar plant, Central Electronics Ltd (CEL), Pawan Hans, and Concor have been either delayed or held back, people aware of the developments said, adding that the challenges faced in completing ongoing strategic sales were also delaying those in the pipeline.
“Legal issues have cropped up in cases of CEL and Pawan Hans, even after the divestment process was complete, but the transactions have been held up,” a senior official said, requesting anonymity.
The government is yet to decide on whether it will reconsider the entire transaction process of CEL, where an examination of allegations made by the public sector enterprises’ employees union was being done, due to which the letter of intent to the winning bidder Nandal Finance and Leasing Ltd has been put on hold. The company’s bid was approved for ₹260 crore in November 2021.
A second official said the sale of non-core assets in Shipping Corp. of India, BEML and NMDC’S Nagarnar steel plant
was moving at a slow pace as the companies have to separate the assets before the transactions can take place.
Mint reported last month that Shipping Corp.’s Mumbai headquarters Shipping House, a training institute in Powai and some other properties will not be sold but be transferred to the demerged Shipping Corp. of India Land and Assets Ltd.
As part of its strategic disinvestment strategy, the government will transfer its entire shareholding of 63.75% in Shipping Corp., along with management control, to a private entity.
“Only a handful of firms such as HLL Lifecare and Projects and Development India are making progress,” the official said, noting that several companies have evinced interest.
Queries sent to the spokespeople for the department of investment and public asset management and the finance ministry remained unanswered.