In order to administer and manage sick public sector units (PSUs) that can be revived, a government panel has recommended formation of a joint venture company funded by seed equity from Maharatna and other cash-rich central public sector enterprises (CPSEs).
The committee, headed by NTPC Chairman Arup Roy Choudhury, had submitted its report in October 2014 including analysis of sick CPSEs and recommendations for formation of a company to revive sick state run enterprises. Besides, the Panel’s report also included identifying sources from which funds may be raised for the proposed entity as equity capital and to recommend organisational structure of the proposed entity and its interface with the Ministries.
Till October 31, 2014, the government has approved the revival of 48 CPSEs and closure of 4 CPSEs on the basis of recommendations of the Board for Reconstruction of Public Sector Enterprises (BRPSE). The move envisages total fund/non-fund based assistance of Rs 41,139 crore including cash assistance of Rs 11,135 crore and non-cash assistance of Rs 30,004 crore.
Earlier in November, Finance Minister Arun Jaitley had stressed that the government may privatise some loss making public sector units (PSUs). India has 79 loss making PSUs, of which 49 are sick enterprise.