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Centre plans to divest stakes in sick PSUs

Geete said his ministry was in talks with the two state governments to take over operations at the Palakkad and Kota units of IL

BS Reporter  |  New Delhi 

Centre plans to divest stakes in sick PSUs

The Union government wants to transfer the ownership of two units of central public sector firm Instrumentation Limited (IL) to Kerala and Rajasthan governments, Heavy Industries Minister Anant Geete said here on Tuesday.

Geete said his ministry was in talks with the two state governments to take over operations at the Palakkad and Kota units of IL.

He added the Cabinet was likely to decide on a proposal to shut down the terminally-ill Hindustan Cables by offering a voluntary retirement scheme to its 1,500-odd employees in a couple of weeks.

While the Palakkad unit of IL has 350 employees, the original Kota branch has 600 employees. IL, established in 1974, provides support to core sector establishments such as steel, power, cement and oil refineries as well as small and large scale industries.

While the Kota unit has been in the red since many years, the Palakkad unit has been making profits. Employees of the Palakkad unit have been demanding that the government either de-link the profit-making unit from its loss-making mother unit at Kota or merge the Kerala unit with a profit-making

While there has been a positive response from Kerala for the takeover offer, that from Rajasthan has been negative.

The Centre had last month approved hiving off profit-making Rajasthan Electronics and Instruments Limited (REIL) from its parent company IL and turning it into an independent central public sector enterprise.

As for Hindustan Cables, reports of the company's revival had surfaced after the defence ministry approved its takeover by the Ordnance Factories Board.

The Board for Reconstruction of Public Sector Enterprises was supposed to take a call on it after taking into account the views of all ministries concerned. "The company's employees will be offered voluntary retirement according to the 2007 pay scale, whereas they were being paid according to a pay scale from 1987," said Geete.

The Cabinet Committee of Economic Affairs had earlier approved closure of seven sick public sector units, including Hindustan Cables, which have incurred a total loss of Rs 3,139 crore over a period of time.

First Published: Wed, March 09 2016. 00:30 IST
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