Telangana government plans to sell stake in PSUs

Hyderabad: The Telangana State government is planning to divest its stake in loss-making and non-functional state public sector undertakings (PSUs) to prevent further losses and to mobilise funds for various welfare and development programmes.

Most PSUs in the state are running in deep losses and the government wants to put its stake up for sale to private parties who can revive the units. The government wants to set up a disinvestment commission to frame guidelines for disinvestment.

Telangana has 66 PSUs, of which 11 working PSUs pertain exclusively to Telanga-na, 33 PSUs are under demerger following the bifurcation of the state in June 2014 while the other 22 are non-functional PSUs, which are yet to be bifurcated.

The CAG, in its latest report, recommended that, “Since non-functional PSUs are not contributing to the state economy and not meeting intended objectives, these should either be closed down or revived.”

The government’s total investment in th-ese 66 PSUs has been p-egged at Rs 60,233 crore.

The government investments in working PSUs were worth Rs 7,700 crore in 2010; that figure has gone up to Rs 17,594 crore now.

The 11 working PSUs, which function for Telangana, have incurred an aggregate loss of Rs 351 crore; only one PSU declared a dividend of Rs 129 crore. The 33 PSUs under demerger incurred an aggregate loss of Rs 444.12 crore; four PSUs declared a dividend of Rs 16.19 crore.

The government has asked the industries department to consider and work out the CAG’s recommendations on closure or revival of sick units.

Following this, the industries department has suggested putting the government stake in these PSUs up for sale to enable private parties to take over the units and revive them.

“Operating sick units is a drain on the state exchequer. To prevent further losses and to revive the units, a stake sale looks like a good option. The CAG too recommended the same,” said an official in the industries department.