Govt Very Keen To Sell BSNL, Air India To Private Firms Under ‘Strategic Disinvestment’; But Will Employee Unions Agree?
But the Ministry of Finance still planning to aggressively follow a policy of disinvestment including strategic disinvestment after Diwali.
BSNL is in the news due to delayed September salary which they finally received in October. There was also a talk about the revival plan for the company during Mid October.
How Did This Happen?
They are planning to BSNL and MTNL disinvestment partly on political grounds and partly on advice by the bureaucracy.
According to their advice, a state-run telecom entity is required, mostly for sensitive areas.
It has also advised that the ministry to go for the strategic sales to private sector bidders.
Who Is Objecting?
The process is facing strong objections from BJP’s labor wing, Bharatiya Mazdoor Sangh. He is in opposition to the disinvestment of the two telecom PSUs.
According to him, the BSNL plays a very important role in the connectivity in remote states and large stretches of rural areas, halting the privatization of the telecom giants.
Why Disinvestment Is Proposed?
According to officials, the sale of their assets and bonds would be used to revive the two as a merged entity.
They said, “However, this does not mean there is any change in the philosophy laid down that the government should not be in the business of running businesses,”.
While being cautious the official said that the government does not want a repeat of the old scenario where a PSU’s shares were sold to another PSU just so as to fulfill disinvestment targets but “rather to go in for strategic sales where domestic and international bidders can be encouraged to participate.”
To speed up this process of disinvestment, a new secretary has been introduced to supervise the disinvestment process.
Anil Kumar Khachi is replaced by Tuhin Kanta Pandey mainly to supervise the strategic disinvestment.
What Is The Plan?
Following the strategic decision, Air India is most likely be the first big strategic disinvestment to come into effect from next month.
To make it an attractive buy for the bidders, a revised offer where 100% stake beside a host of other concessions including write off of a large portion of its debt is likely to make, according to officials.
They are expecting that the Air India’s bilateral rights and airport slots, some of them in use and some in reserve, besides its assets and goodwill would be the prime attractions about this offering.
As part of the plan, the government is planning to use a combination of bond issues and write-offs to pare down the state-run airline’s debt from Rs 28,000 crore as of last year to Rs 12,500 crore. (reference)
In the next round the government is also planning to sell off the two oil public sector undertakings (PSUs) — BPCL and HPCL to a strategic buyer within this financial year.