KASARGOD: Four years after making the announcement, the government of Kerala bought back BHEL-EML, an electrical machinery manufacturer, from Union government-owned Bharat Heavy Electricals Limited (BHEL). Chief Minister Pinarayi Vijayan announced the acquisition of the Kasaragod-based unit at an online function on Wednesday. Industries Minister P Rajeeve presided over the function.
A statement from the Department of Industries referred to the new unit as Kasaragod Electrical Machines Ltd. The state government has taken over the PSU unit with an outlay of Rs 77 crore, which includes `43 crore required for reviving the company and `34 crore liability, Pinarayi said. BHEL had not paid salaries to the 174 for the past two years and the liability includes the salary dues of Rs 14 crore. After announcing the takeover, the chief minister said the government should start public sector undertakings (PSUs) in all areas where it could make an intervention.
“The government aims to make all public sector enterprises profitable. The activities of public sector undertakings will be diversified and expanded,” he said. A comprehensive master plan for each undertaking would be published, he said.
In 2010, BHEL -- one of the biggest central PSUs -- took over the Kasaragod unit of Kerala Electrical and Allied Engineering Company (KEL), a 100% state government-run company. The unit was then valued at Rs 10.5 crore and BHEL bought a 51% stake for `5.5 crore. The state government, however, returned Rs 5 crore to the newly formed BHEL-Electrical Machines Ltd (BHEL-EML) to clear the salary dues and pay other benefits to the employees.
Though the Kerala government had a 49% stake, it got only one seat on the board of directors. BHEL promised to invest in the company and expand the product line. But the Maharatna company made zero investment and never gave its employees a salary hike. Employees suspected BHEL took over the profitable unit to ground it. The product line of BHEL-EML includes brushless alternators, train lighting alternators, traction machines, induction motors, and diesel generator sets, with Railways and Defence Ministry being the main clients. With no working capital, the company started losing clients and orders.
On August 5, 2016, the Ministry of Heavy Industries and Public Enterprises, which controls BHEL, wrote to Chief Minister Pinarayi Vijayan that it was inclined to give up its 51% stake in BHEL-EML. On June 12, 2017, the chief minister announced it would buy back the 51% stake from BHEL. On Wednesday, the chief minister said the state government decided to buy back BHEL-EML because it was facing the misfortune of the Union government’s plan to privatise it. After the 2017 announcement, BHEL gave up on the unit and stopped paying salaries on time.
ISSUES IN SALARY PAYMENT
After the 2017 announcement, BHEL gave up on the unit and stopped paying salaries on time. In March 2020, the unit was officially shut under the pretext of the nationwide lockdown and it was never reopened.