Centre steps up disinvestment process
Will categorize all asset-holding central public-sector enterprises created for managing the non-core assets under disinvestment from date of their formation
image for illustrative purpose
In June 2023, there were 71 CPSEs under Schedule A, 68 under Schedule B, 38 under Schedule C, and five under Schedule D
Categorization & Revision
- DPE laids down certain criteria
- Parameters include quantitative factors
- Investment (paid-up capital plus long term loans)
- Capital employed (net block plus net working capital)
- Net sales, profit, number of employees and units
Hyderabad: The central government has decided to categorize all asset-holding central public-sector enterprises (CPSEs) created for managing the non-core assets of the CPSEs under disinvestment as Schedule C from the date of their formation. This, official sources told Bizz Buzz, will facilitate the disinvestment process.
The classification of CPSEs in four Schedules dates back to 1965. It was essentially aimed at providing relativity between the compensation structures of Board-level executives of CPSEs. The categorization into four Schedules—A, B, C, and D—was initially made by a committee of Secretaries on the basis of CPSEs importance to the economy and complexities of problems. After 1967, the categorization of the new CPSEs was being decided by the administrative ministry concerned in consultation with the Department of Public Enterprises (DPE).
At present, the DPE is under the Ministry of Finance. The DPE has laid down certain criteria for the categorization and revision (upgrade) of the Schedule of CPSEs. The parameters adopted for this purpose are quantitative factors like investment (paid-up capital plus long term loans), capital employed (net block plus net working capital), net sales, profit, number of employees, and number of units.
The qualitative factors are national importance, complexities of problems, the level of technology, prospects for expansion and diversification of activities, and competition from other sectors.
There are classifications too like Navratna and Miniratna. The DPE has also decided that the already approved CPSEs and yet to be made functional CPSEs will be categorized as Schedule C as and when the administrative Ministry/Department concerned deems it necessary to make the said company functional.
The administrative ministries can also propose and obtain the concurrence of the Cabinet or the Alternate Mechanism (as applicable to disinvestment cases) if they want a CPSE to be categorized in higher Schedule as A or B. The upgrade of any functional CPSE from the existing Schedule to a higher one will follow the extant procedure that was prescribed 2011, the sources said. In June last year, there were 71 CPSEs under Schedule A, 68 under Schedule B, 38 under Schedule C, and five under Schedule D.
