Five public sector undertakings (PSUs) will be closed down by the government, which has included some of the best known state-run enterprises like Air India, MTNL and Hindustan Shipyard, in the list of 65 sick PSUs.
"The five state-run organisations to be closed down include three HMT units, whose brand of watches and tractors once ruled the market," Heavy Industries Minister Anant Geete said during Question Hour in Lok Sabha on Tuesday, adding that their employees were being offered a "very good" VRS package.
However, he did not name the other PSUs which are slated to be closed
down.
The minister said there were 65 units in the list of sick PSUs as of
March 31 last year. "The reasons for their sickness vary from enterprise
to enterprise and included obsolete plants and machinery, heavy interest
burden, resource crunch, surplus manpower and shortage of working
capital," he said.
Geete said the concerned administrative ministries "prepare
proposals for revival or otherwise of sick companies on case to case basis and
obtain approval of the government."
Air India and MTNL, once market leaders in aviation and mobile
telephony sectors respectively, were declared sick according to the criteria
for a PSU to be declared as such, after they incurred losses worth 50 per cent
or more of their average net worth during four preceding years.
Air India accumulated losses of Rs 5,388 crore, Rs 5,490 crore and Rs
7,559 crore in years 2013-14, 2012-13 and 2011-12 respectively, according to
the figures tabled in the House.
MTNL showed profit of Rs 7,820 crore in 2013-14 but had incurred losses
of Rs 5,321 cr and Rs 4,109 cr in the previous years.
Hindustan Shipyard posted losses of Rs 859 crore, Rs 551 crore and Rs
462 crore in the three years.
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