NEW DELHI: The government is working out a plan to optimally utilise land banks of state run companies as part of its bigger ambition to monetise the assets of public sector enterprises. The government will look at all central public sector companies (CPSEs), including profit making firms, to assess if their existing resources can be utilised for spurring the economic growth, a senior government official told media.
This comes after the government successfully nudged five state-run firms, including blue chips such as Coal India, NMDC, MOIL and Nalco, to announce a buyback of their shares. The buybacks by these firms is expected to deliver a bonanza of Rs 12,000 crore to the exchequer. “We will come out with a detailed plan which will include the land banks available with these firms,” the above quoted official said, adding that the government will initially focus on loss making enterprises.
“Those units which are being closed, their land will be sold or transferred,” he added. Of the 74 loss-making companies, NITI Aayog has identified 26 for closure or winding up. The government has budgeted Rs 56,500 crore of revenue from disinvestment, including Rs 20,500 crore from strategic sales in this fiscal. The government may offer the land available with these loss making enterprises to state governments, other CPSEs or public sector banks.
“If another CPSE is interested in setting up a unit, that land bank will be made available, subject to clearances, if required,” the official said, adding that administrative ministries will hold discussions with their respective firms. The assessment is on for four companies that have been closed down. These firms include HMT Chinar Watches Ltd., HMT Watches Ltd., HMT Bearings Ltd. and Tungabhadra Steel Products Ltd. (TSPL).
“If the land is on lease from the state government it will be returned to them as per lease conditions,” said another official aware of the deliberations. In his budget speech, finance minister Arun Jaitley had said that there’s a need to use the assets of CPSEs for generation of resources for investment in new projects.
Credits ET Realty