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Cabinet approves Rs 330 crore loan to help three pharma PSUs meet salary payments

The Union Cabinet on Wednesday approved loans worth Rs 330.35 crore for three state-owned pharma companies to help them clear employees’ liabilities.

Published: 18th July 2019 07:38 AM  |   Last Updated: 18th July 2019 07:38 AM   |  A+A-

Prime Minister Narendra Modi, Defence Minister Rajnath Singh (File Photo | EPS, Shekhar yadav)

By Express News Service

The Union Cabinet on Wednesday approved loans worth Rs 330.35 crore for three state-owned pharma companies to help them clear employees’ liabilities. It also announced that a ministerial panel will be set up to decide on the closure or sale of four PSUs.

Chaired by Prime Minister Narendra Modi, the Cabinet decided to provide budgetary support in the form of loans to the tune of Rs 330.35 crore to Indian Drugs & Pharmaceuticals Ltd (IDPL), Rajasthan Drugs and Pharmaceuticals Ltd (RDPL) and Hindustan Antibiotics Ltd (HAL). “Budgetary support of Rs 330.35 crore 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 1,000 employees of these PSUs,” an official statement said. Around Rs 158 crore will be utilised to clear unpaid salaries and another Rs 172 crore will go towards meeting VRS liability.

Meanwhile, the Cabinet also approved the constitution of a committee of ministers to take all decisions pertaining to the closure or strategic sale of four public sector undertakings, including the sale of assets and clearance of outstanding liabilities. “Setting up of a Committee of Ministers would expedite in process of implementation of the earlier Cabinet decision dated December 28, 2016 for closure of IDPL and RDPL and strategic sale of HAL and BCPL,” it said.

The Cabinet had initially decided in 2016 to sell surplus land of HAL, IDPL, RDPL and 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,” the statement said. However, while efforts were made to sell the surplus realty assets, no buyers could be found despite issuing tenders more than once.

The Department of Public Enterprises (DPE) has now issued revised guidelines (on June 14, 2018) for the disposal of PSU land. “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,” the statement said.

Budgetary support

The Union Cabinet decided to provide budgetary support in the form of loans to the tune of H330.35 crore to Indian Drugs & Pharmaceuticals Ltd (IDPL), Rajasthan Drugs and Pharmaceuticals Ltd (RDPL) and Hindustan Antibiotics Ltd. Around H158 crore will be utilised to clear unpaid salaries and another H172 crore will go towards meeting the VRS liabilities.

The Cabinet also approved the constitution of a committee of ministers to take all decisions pertaining to the closure or strategic sale of four PSUs, including the sale of assets and clearance of outstanding liabilities

The Cabinet had decided in 2016 to sell surplus land of HAL, IDPL, RDPL and BCPL through open competitive bidding to government agencies and clear the outstanding liabilities. However, no buyers could be found despite issuing tenders more than once.
 

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