Indian two thousand rupee banknotes. (Photographer: Dhiraj Singh/Bloomberg)

Government To Begin Monetising Assets Of CPSEs From April

The government will start the process to sell non-core assets of state-owned companies, which have been identified for strategic disinvestment, next fiscal, an official said.

The Cabinet has already approved strategic sale of about two dozen central public sector enterprises, including Air India, Dredging Corporation Of India Ltd., and BEML Ltd.

Out of this, the Department of Investment and Public Asset Management has already identified nine CPSEs for sale of land and other assets before they're put on the block. These include Scooters India Ltd., Air India, Bharat Pumps & Compressors Ltd., Project & Development India, Hindustan Prefab, Hindustan Newsprint Ltd., Bridge and Roof Co and Hindustan Fluorocarbons.

DIPAM has been drafting an asset monetisation framework, which will lay down the procedures for the administrative ministries to follow in selling CPSE assets.

"Asset monetisation framework will see the light of the day next fiscal. The framework and assets will get defined by the time we finish this fiscal. The actual process will start next fiscal. The framework would define the assets, define various models under which they can go for monetisation and also the process to follow," DIPAM Secretary Atanu Chakraborty told PTI in an interview.

Monetisation of assets is among the slew of strategies that the DIPAM will follow to meet the Rs 90,000 crore disinvestment target set up for the next fiscal. This is higher than the Rs 80,000 crore the department is expected to raise this fiscal ending March.

The DIPAM has already floated a draft Cabinet note on the guidelines, which would be applicable for those central public sector undertakings that are likely candidates for strategic disinvestment.

However, any state-owned company which wants to sell its non-core assets, too, can follow the framework.

The framework, among other things, will stipulate the quantum of funds that would accrue to the CPSEs following the sale of assets and how much would go into the exchequer, an official had said earlier.

The government had already given in-principle approval for strategic sale of 24 state-owned companies.

These include Dredging Corporation of India, HLL Lifecare, Bharat Earth Movers Ltd, Units/JVs of ITDC, Bhadrawati, Salem and Durgapur units of SAIL, Nagarnar Steel Plant of NMDC, Central Electronics and Ferro Scrap Nigam.

With regard to Air India, the government has already initiated the process of selling its land and real estate properties—including Airlines House in Mumbai, realty property in Delhi's Vasant Vihar and land on Baba Kharak Singh Marg, next to Connaught Place.