Ahead of the Cabinet expansion, the Finance Ministry has had a new addition — the Department of Public Enterprises (DPE), which was until now part of the Ministry of Heavy Industries and Public Enterprises.
The Cabinet Secretariat has notified an amendment in the Government of India (Allocation of Business) Rules, 1961, which prescribes: “in THE FIRST SCHEDULE under the heading ‘13. Ministry of Finance (Vitta Mantralaya)’, after the sub-heading ‘(v) Department of Financial Services (Vittiya Sewayen Vibhag)’, following sub-heading shall be inserted, namely: - ‘(vi) Department of Public Enterprises (Lok Udyam Vibhag)’.”
The amendment will come into force at once.
Is it time to rethink PSE policy?
As on date, the Finance Ministry has five departments: Economic Affairs, Revenue, Expenditure, Investment and Public Asset Management, and Financial Services. It is believed that since one department of the Finance Ministry is dealing with Central Public Sector Enterprises (CPSE), bringing the DPE under it would make co-ordination easier.
Commenting on the decision, Nirmal Gangwal, Managing Partner at Brescon & Allied Partners LLP, said the government’s revenue mop-up cannot be limited to tax collection, and the focus should now be on monetising and realising the value created by PSUs. “PSUs have played an important role in the development of the economy, and the move will put more responsibility on the Finance Ministry to realise maximum value out of the privatisation exercise. This would also help in quicker decision-making for privatisation of PSUs,” he said.
New disinvestment policy cleared by the Cabinet
The notification reiterated 12 areas for DPE, includingcoordination of general policy affecting all public sector enterprises; evaluation and monitoring the performance of public sector enterprises, including the memorandum of understanding mechanism; review of capital projects and expenditure in central public sector enterprises; measures to improve the performance of central public sector enterprises and other capacity-building initiatives of ; rendering advice relating to revival, restructuring or closure of public sector enterprises including the mechanisms; and categorisation of central public sector enterprises including conferring ‘Ratna’ status.
The Heavy Industry Ministry will continue to be the nodal one for the automobile and capital goods sector. It will have 44 areas for administrative work, which includes central public sector enterprises such as BHEL, Cement Corporation, Scooters India and others.
New ministry
Another notification carved out ‘Cooperation’ from the Department of Agriculture, Cooperation and Farmers Welfare under the Agriculture Ministry, to set up the new ‘Ministry of Cooperation (Sahkarita Mantralaya)’. Nine work areas have been allocated to the new Ministry, including general policy in the field of co-operation and co-ordination of co-operation activities in all sectors; realisation of vision “from cooperation to prosperity”; strengthening of cooperative movement in the country and deepening its reach to the grassroots; promotion of cooperative-based economic development model, including the spirit of responsibility among members to develop the country; creation of appropriate policy, legal and institutional framework to help cooperatives realise their potential; and the National Co-operative Development Corporation, among others.