Bengal To Privatise 10 Public Sector Units

Reviving its privatisation initiative, the West Bengal government today decided to go in for restructuring of five Public Sector Enterprises (PSEs) and to hand over the operation of five other PSEs to joint venture partners, setting a six-month timeframe for the process.

Deloitte & Touche Consulting India Pvt Ltd (DTCI) has been given the mandate to take the process forward. Sources in the government said, “The government will not shy away from sensible decisions because of political compulsions or opposition - the gains from restructuring of PSEs like Great Eastern Hotel are visible”.

The PSEs under the hammer included the state dairies at Belgachhia and Haringhata for restructuring, along with medical equipment maker Electro Medical Ltd, the West Bengal State Warehousing Corporation and the West Bengal Small Industries Development Corporation.

The five PSEs to be handed over to private sector investors as joint ventures were three spinning mills producing natural fibre yarns and textiles, and two state dairies at Barddhaman and Durgapur

The four dairies covered several thousand acres of land, were burdened with close to 4,000 employees and produced a meager quantity of liquid milk.

The spinning mills also owned some real state, but did not have too many workers. The warehousing corporation had strategically-located logistics space under management.

The scale of operations of Electro Medical, which made goods like blood bags and X-ray related consumables, and the development corporation, were limited.

The initiative was a part of the Department for International Department (DFID) - supported project for restructuring PSEs in West Bengal. Bids had been invited from reputed consultants to take forward the restructuring exercise.

DTCI was awarded the largest number of mandates and asked to developing restructuring plans for five PSEs and for undertaking joint venture transformation for the five others.

The exercise is slated to be completed over a period of six months.

Highlights of the programme include a stated intent on the part of the West Bengal government to re-deploy budgetary savings generated through PSE restructuring in social and poverty alleviation initiatives and a social safety net programme.

“The significant win despite strong competition demonstrates Deloitte Consulting’s value proposition that cuts across services like consulting, tax and financial management seamlessly. We are like a Swiss knife, our value comes from a single brand with multiple competencies,” said Roopen Roy, managing director of DTCI.