The Modi government is considering a proposal to disinvest another 11 public sector companies, including Delhi's landmark Ashok Hotel, MTNL's tower business and equipment-maker Bharat Heavy Electricals (Bhel) through a mix of long-term lease, asset and strategic sale. With NITI Aayog sharing the latest sell-off list with the finance ministry, as many as 50 companies have now been recommended for disinvestment via the strategic sale and leasing route.
Officials from the Finance Ministry said that proposals were being studied and a final decision will be taken by the cabinet committee on economic affairs. They, however, defended the move on strategic sale so far, arguing that the government was on course to complete some of the transactions, including Air India, where 76 per cent equity is being offered for sale compared to the recommendation of 100 per cent. Sources said NITI Aayog has recommended leasing out Hotel Ashok, spread out in New Delhi's diplomatic enclave, for 60 years. While the former Atal Bihari Vajpayee government had sought to sell Hotel Ashok, the plan was resisted by the tourism ministry. Even during the Narendra Modi regime, the sale of ITDC hotels had not been taken off as the government has opted to play safe.
Among other PSUs under the fifth disinvestment plan, NITI Aayog has listed Bhel as one of the candidates, citing erosion in its market value over the last few years compared to private sector players such as Larsen & Toubro, that has aggressively grown and diversified. People in the know said the panel headed by economist Rajiv Kumar has also recommended that government should begin selling assets in MTNL, once a top state-run company, which is now the third-biggest loss maker behind BSNL and Air India. The proposal is to hive off the telecom PSU's towers into a separate company and sell off the entity.
Other companies — from National Textiles Corporation to Hindustan Copper and Telecommunications Consultants (India) — may be put up for strategic sale with NITI Aayog recommending that government could exit most of these PSUs. While some of the companies, such as NTC, reported impressive profit in 2016-17, it was on the back of exceptional items or one-time gains.
