The Central government has approved strategic sale in loss-making Bharat Pumps and Compressors Limited, a move that came 12 years after a state-run company Jessop & Company was sold through the route. The cabinet committee on economic affairs approved "in principle" the strategic sale in the Allahabad-based public sector enterprise which was set up in 1970 as an import substitution unit for manufacture of process pumps and compressors for sectors such as oil exploration, refineries, petrochemicals, chemicals, fertiliser and down-stream industries.
The Cabinet also approved the closure of Kolkata-based Hindustan Cables Ltd, where production activity stopped in January 2003. Government will pay voluntary separation package to the employees. Cash infusion for the closure of the company is estimated at £131 million, as per a government statement. Modi's government has vowed to push through strategic sales, and expects to raise £2.05 billion from the route in the current financial year. The overall target from disinvestment is estimated at £5.65 billion, lower than the previous year's target of £6.95 billion.
The government had entrusted the Niti Aayog to suggest a roadmap for strategic sale in loss making and other state-run firms. The agency has submitted two reports to the government on the issue. The government is also pursuing strategic sales in some state-run hotels as well. It has decided to shut down 15 loss-making public sector units, of which at least six have now been cleared by the cabinet.