The Centre may look at privatising public sector undertakings (PSUs) in the fertiliser sector, a report by Business Standard stated. It could be the first non-strategic sector where the government may implement its new Public Sector Enterprises (PSE) Policy, 2021, noted the report.
"The central government is learned to be considering Rashtriya Chemicals and Fertilizers, National Fertilisers, Fertilizers and Chemicals Travancore (FACT), Fertilizer Corporation of India, and other fertiliser PSUs for privatisation. The process of privatising fertiliser PSU Project & Development India (PDIL) is already underway, and the Centre has received a good response from interested parties," informed the BS report.
The Committee of Group of Officers (CGO), chaired by the NITI Aayog chief executive officer, is learned to have identified these PSUs for privatisation and a sectoral note has been prepared, the report further stated.
The CGO is tasked with identifying PSUs in non-strategic sectors for closure or privatisation. The note is said to have been prepared in consultation with the administrative ministry, it added.
It is important to note that according to the PSE policy, 2021, the government will look at leaving non-strategic sectors, such as fertiliser, steel and tourism, by privatising or closing PSUs.
"According to the policy, after sectoral and PSU identification, the DPE will seek in-principle approval from the Cabinet Committee on Economic Affairs (CCEA). Once approved by the CCEA for divestment, DIPAM will initiate the privatisation process. In case of closure of a PSU in a non-strategic sector, the DPE will drive the process, along with the administrative ministry. The closure timeline of PSUs has been revised to about eight months from approval from the CCEA," informed the report.
In FY20, six fertiliser PSUs had reported a profit of ₹1,293 crore, against eight PSUs reporting a profit of ₹880 crore in FY19, it added.