“BHEL has made ground-breaking achievements”
Mr Anant Geete is a political stalwart who has represented the Shiv Sena very ably in Parliament—he has been elected MP six times between 1996 and 2014—and as a Minister in the NDA Government. Credit for much of the political camaraderie that exists between the BJP and the Shiv Sena at the Centre goes to Mr Geete for things have not always been hunky dory between the two parties in Maharashtra. Back in the days of the Atal Bihari Vajpayee Government, Mr Geete had been Union Power Minister. Now having completed three years as Union Minister for Heavy Industries and Public Enterprises, Mr Geete is easily one of the senior-most faces in a Cabinet rank in the Narendra Modi Government. India Empire had featured him on the cover in the December 2015 edition. In this issue, he responds to a few questions from the magazine once again:
Guidelines were set in 2016 by the Department of Public Enterprises to expedite the process of closure of weak CPSEs. What is the progress made on the implementation of those guidelines?
In May, 2014 when the NDA Government took over under the leadership of Shri Narendra Modi as Prime Minister, there were 32 Central Public Sector Enterprises (CPSEs) under the Department of Heavy Industry, majority of them were incurring losses for last several years and had become chronically sick. Most of these CPSEs were not in a position to even pay salary / wages to their employees and had become financially dependent upon the budgetary support from Govt. of India to discharge their statutory liabilities towards employees. Government had been supporting these CPSEs through non-plan loans since the year 2004, for payment of salary, wages and other statutory dues to their employees. CCEA in its meeting held on 10th September, 2014 approved an amount of Rs. 287.67 crore as non-plan loan to 11 CPSEs towards payment of salary, wages and employee related statutory dues for the period September, 2013 to March, 2014. With this cash outgo, the Government had so far released Rs. 3084.28 crore to 24 CPSEs in last decade since the year 2004. These CPSEs were also provided various Revival packages also from time to time wherein financial restructurings were allowed which contained conversion of loan into equity, waiver of interest, infusion of fresh equity and also loan for working capital etc. However, most of these companies failed to come up to the expectations and revive itself. There were many factors responsible for the sub-optimal performance of the CPSEs. Some of the broad reasons were, overstaffing, huge manpower cost, obsolete and out-dated plant & machineries, old and obsolete products range, failure to adopt new technology, change in consumer preference and behaviour, change in economic environment of business with opening up of the economy in 1991, stiff competition from emerging lean, mean and strong private sector.
Seven CPSEs/Units of CPSEs—Tungabhadra Steel Products Ltd., HMT Chinar Watches Ltd., HMT Watches Ltd., HMT Bearings Ltd., Hindustan Cables Ltd., HMT Ltd., Instrumentation Ltd. Kota Unit, have since been closed down operationally with the approval of Government of India.