Government rules out Disinvestment of BHEL

Union Government today ruled out the disinvestment of Bharat Heavy Electricals Limited, BHEL. In a written reply in the Rajya Sabha, Minister of State for Finance Anurag Thakur said, the government has not taken any decision for strategic disinvestment and privatization of BHEL.

Replying to another question, he said, the government has fixed the disinvestment target of Rs 1,05,000 crore for the current fiscal year and till last month has received Rs18,345 crore through disinvestment.

Mr Thakur said, disinvestment is an ongoing process and the timing of a disinvestment transaction depends on the prevailing market conditions and investors interest.

Government's Disinvestment Plan

Earlier on January 8, 2020, the Cabinet Committee of Economic Affairs (CCEA) approved the strategic disinvestment of Minerals & Metals Trading Corporation Limited (MMTC), National Mineral Development Corporation (NMDC) (10.10%), MECON (0.68%) and Bharat Heavy Electricals Ltd. (BHEL) (0.68%) and two Odisha State Government PSUs namely; Industrial Promotion and Investment Corporation of Odisha Ltd.(IPICOL) (12.00%) and Odisha Mining Corporation (OMC) (20.47%) in Neelachal Ispat Nigam Limited (NINL) to a strategic buyer, identified through a two-stage auction procedure.

As per the plan, the government will offload 49.78 per cent equity shareholding in MMTC, 10.10 per cent in NMDC, 0.68 per cent each in BHEL and MECON, 12 per cent in IPICOL and 20.47 per cent in OMC. The offloaded equity will be provided to a strategic buyer after a two-stage auction procedure.

NINL is a Joint Venture company, in which four CPSEs namely MMTC, NMDC, BHEL and MECON and 2 State PSUs of Odisha Government, namely IPICOL and OMC are shareholders.

The proposed strategic disinvestment of NINL would unlock resources to be used to finance the social sector/developmental programmes of the Government benefiting the public. It is also expected that the successful strategic buyer may bring in new management/technology/investment for the growth of the company and may use innovative methods for the development of the business operations of the company, which may generate more employment opportunities.

BHEL

It is India's largest engineering and manufacturing enterprise with the capability to manufacture entire range on power plant equipment. It was established in 1964.