The Union Cabinet chaired by Prime Minister Narendra Modi has approved the following decisions:

Modifying the earlier decision dated 28.12.2016 of sale of land of PSUs to government agencies and instead permitting the sale of land as per revised DPE's guidelines dated 14.06.2018; and

Providing budgetary support as loan to the tune of ₹ 330.35 cr. for meeting the employees’ liabilities (Unpaid salary - ₹ 158.35 cr. + VRS ₹ 172.00 cr.) as per following break-up:

a. IDPL - Rs.     6.50cr.

b. RDPL- Rs.  43.70cr.

c. HAL   - ₹ 280.15 cr.

(iii) Constitution of a Committee of Ministers for taking all decisions pertaining to closure/ strategic sale of the four Public Sector Undertakings, including the sale of assets and clearance of outstanding liabilities.

Major Impact:

Budgetary support of ₹ 330.35 cr. would help in disbursing the unpaid salaries and providing support for VRS of employees of IDPL, RDPL and HAL. The decision would mitigate sufferings of more than 1000 employees of these PSUs; and

Setting up of a Committee of Ministers would expedite in process of implementation of the earlier Cabinet decision dated 28.12.2016 for closure of IDPL and RDPL and strategic sale of HAL and BCPL.

Background:

Cabinet had decided on 28.12.2016 to sell surplus land of Hindustan Antibiotics Limited (HAL), Indian Drugs & Pharmaceuticals Limited (IDPL), Rajasthan Drugs and Pharmaceuticals Ltd. (RDPL) and Bengal Chemicals & Pharmaceuticals Ltd. (BCPL) through open competitive bidding to Government agencies and clear the outstanding liabilities from the sale proceeds. It was decided that after meeting the liabilities, IDPL and RDPL would be closed and HAL and BCPL put up for strategic sale. Department took earnest efforts for sale of surplus land, but could not find buyers, despite issuing tenders more than once. Meanwhile, the Department of Public Enterprises (DPE) has issued revised guidelines on 14.06.2018 in respect of disposal of land of the PSUs. As funds could not be generated through sale of surplus land, the employees in few of the PSUs (HAL and RDPL) could not be paid salaries and VRS scheme floated. As such, it was decided to dispose of the land as per revised DPE's guidelines and seek up-front budgetary support for meeting employees' liabilities.

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AKT/PK/SH

Sale of PSU land under revised DPE guidelines permitted, enabling budgetary loan support and ministerial committee for closures. Cabinet authorised sale of surplus land of four pharmaceutical PSUs pursuant to the revised DPE guidelines dated 14.06.2018 instead of the earlier 28.12.2016 approach, and sanctioned upfront budgetary loan support to meet unpaid salaries and voluntary retirement liabilities for affected employees of IDPL, RDPL and HAL. It further constituted a Committee of Ministers to decide on closure, strategic sale and asset disposal and to clear outstanding liabilities, to expedite implementation where land-sale proceeds were not realised.