Govt may commission studies on divestment of state-run firms

 

The latest available survey for 2020-21, which is the 61st publication in the series, segregates these companies into various sectors such as agriculture, mining, manufacturing, processing and services.

New Delhi:The central government may commission studies to assess the impact of strategic divestments of state-run enterprises in unlocking their economic potential after privatisation, officials aware of the development said.

The proposal is in line with a suggestion made by the parliamentary standing committee on finance, they said, requesting anonymity. After deliberation on this matter, the government agreed to conduct periodic studies with the help of professionals to supplement the Annual Public Enterprises Survey on the status of value creation in the central public sector enterprises, they said.

“The studies can also be undertaken at appropriate intervals on how strategic disinvestment (privatisation) has contributed to realising economic potential of the enterprises post privatisation,” one of them said.

While the annual survey is released by the Department of Public Enterprises, an arm of the finance ministry, the proposed studies are expected to be the responsibility of Department of Investment and Public Asset Management, another arm of the finance ministry, the official said.

The finance ministry and DIPAM did not respond to email queries on this matter.

The genesis of Annual Public Enterprises Survey is traced to the 73rd report of the estimates committee for the 2nd Lok Sabha in 1959-60, which recommended that in addition to the annual report of each public sector undertaking submitted in Parliament, there should be a separate detailed report highlighting the performance of all state-owned firms. The erstwhile Bureau of Public Enterprises (now DPE) drafted the first survey in 1960-61, showing performance of all CPSEs on key financial and operational parameters.

The latest available survey for 2020-21, which is the 61st publication in the series, segregates these companies into various sectors such as agriculture, mining, manufacturing, processing and services. According to the report, initially here were only five central public sector firms (1951), but by 1969, their number grew to 84 and by 2020-21, they increased to 389. The number of listed central government-owned companies also increased from 50 in 2016-17 to 61 in 2020-21.

The latest survey recorded total paid-up capital of all CPSEs at ₹3.21 lakh crore as on March 31, 2021, as against ₹3.10 lakh crore a year ago. Total financial investments in all CPSEs as on March 31, 2021, was ₹21.67 lakh crore, compared to ₹21.28 lakh crore as on March 31, 2020. Among the sectors, the services sector had the highest investments, accounting for 67.25% of outstanding financial investments in CPSEs, followed by manufacturing and processing (25.09%), and mining with exploration (4.89%).

According to the 2020-21 survey, the total capital employed by all CPSEs was ₹32.47 lakh crore as on March 31, 2021, against ₹30.97 lakh crore a year ago, showing a growth of 4.84%. These firms made an overall net profit in 2020-21 of ₹1.58 lakh crore, compared to ₹93,000 crore during 2019-20, an increase of 69.48%.

The CPSEs contributed ₹4.96 lakh crore in 2020-21 to the central exchequer by way of excise duty, custom duty, Goods and Services Tax (GST), corporate tax, interest on central government loans, dividend, and other levies, a 31.14% year-on-year jump.