Govt looks to shut Tyre Corp, HMT arm

The government is considering shutting down sick Tyre Corporation of India Ltd (TCIL) and a unit of loss-making HMT. However, it has ruled out any divestment in sick public sector undertakings (PSUs).

Speaking at a conference on smart manufacturing organised by the Confederation of Indian Industries (CII), Minister for Heavy Industries and Public Enterprises Anant Geete said on Friday that TCIL and a unit of HMT were being considered for closure. However, he did not divulge which unit of HMT was being considered for closure. The minister also said the government had no plans to set up a land bank using surplus land of PSUs.

Geete, however, clarified the ministry would not be going for disinvestment of other such loss-making PSUs. He added individual proposals would be prepared for those that were approved for closure earlier.

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• TCIL is among the public sector units that had earlier been cleared for revival through a joint venture or disinvestment
   
• The government owned entity reported a net loss of more than Rs 20 crore in 2011-12
   
• The Cabinet had earlier given in-principle approval to shut down five ailing CPSEs - including HMT Bearings, HMT Watches, HMT Chinar Watches, Tungabhadra Steel Products and Hindustan Cables

Headquartered in West Bengal, TCIL is among the public sector units that had earlier been cleared for revival through joint venture or disinvestment. The fully government owned entity reported a net loss of more than Rs 20 crore in 2011-12, according to its website.

The Cabinet had earlier given in-principle approval to shut down five ailing central public sector enterprises - HMT Bearings, HMT Watches, HMT Chinar Watches, Tungabhadra Steel Products and Hindustan Cables. The heavy industries ministry has now firmed up individual proposals and will again approach the Cabinet for a final nod.

Also, the first policy for the country's capital goods sector "will be finalised within one or two months and sent to the Cabinet for approval," Geete said.

The government has proposed a long-term, stable and rationalised tax and duty structure to promote the capital goods sector, one of the vital cogs to realise the Prime Minister's pet Make in India project.

A National Capital Goods Policy was formulated to increase the share of capital goods contribution to 20 per cent of total manufacturing activity by 2025, from 12 per cent, said the draft policy released by the Department of Heavy Industries.

On the Volkswagen issue, Geete said the government had issued a notice to the German car major earlier this month after testing agency, the Automotive Research Association of India, found "significant variations" in on-road emission levels in diesel models of Jetta, Octavia, Audi A4 and Audi A6 in India.

The government, Geete said, would take steps to enable Indian steel industry to compete with China and Korea, from whom it is currently facing stiff competition.