Budget Benefits for Auto and Capital Goods sector

By | March 8, 2016

Anant Geete briefs media on budget issues

Says grant of 200 crores made to the FAME Scheme and Natrip is a welcome step

Also reduction in excise duty from 12.5 percent to 6 percent will help Capital Goods Sector

Union Heavy Industry & Public Enterprises Minister Shri Anant G. Geete today briefed media on the budgetary provisions made for his ministry in the General Budget for the financial year 2016-17. He said    the Department of Heavy Industry is taking various steps in making India a manufacturing hub as well as to implement the ‘Make in India’ campaign launched by Prime Minister, Shri Narendra Modi. To this end, in both the sectors under the remit of DHI, i.e, the Auto sector and the Capital Goods sectors, DHI has initiated positive steps towards consolidation of the Make in India programme. This has been accomplished through technology collaboration through government-academia-industry partnership, MoUs with institutions and technology partners of eminence and appropriate policy interventions.

  1. The Budget presented by the Finance Minister also gives the necessary push to boosting of infrastructure development and the rural sector. The budget proposals are built on this transformative agenda with nine distinct pillars.

(i) Agriculture and Farmers’ Welfare: with focus on doubling  farmers’ income in five years;

(ii) Rural Sector: with emphasis on rural employment and infrastructure;

(iii) Social Sector including Healthcare: to cover all under welfare and health services;

(iv) Education, Skills and Job Creation: to make India a knowledge based and productive society;

(v) Infrastructure and Investment: to enhance efficiency and quality of life;

(vi)  Financial Sector Reforms: to bring transparency and stability;

(vii) Governance and Ease of Doing Business: to enable the people

to realise their full potential;

(viii) Fiscal Discipline: prudent management of Government finances and delivery of benefits to the needy; and

(ix) Tax Reforms: to reduce compliance burden with faith in the citizenry. 

Shri Geete said ,Finance Minister, in his Budget Speech, had stated that a new policy for management of Government investment in Public Sector Enterprises, including disinvestment and strategic sale, has been approved. NITI Aayog has been given the role to identify CPSEs for strategic disinvestment, mode of sale, percentage of shares to be sold and methods of valuation of CPSEs.  My Department (DPE) would be associated in the capacity of member of Core Group of Secretaries and member of Evaluation Committee for Strategic Disinvestment.

This has genesis from the guidelines issued by my Department (DPE) for streamlining the mechanism for revival and restructuring of sick/ incipient sick and weak Central Public Sector Enterprises (CPSEs).  In these guidelines, a criterion was laid for identifying the CPSEs as sick, incipient sick and weak CPSEs.  This has happened for the first time that Government would identify the CPSEs, which are prone to sickness, before they actually become sick/ incipient sick by identifying their weaknesses and taking remedial measures.  It is for the first time that Government would go beyond Balance Sheet items and would look into contingent liabilities given in notes on accounts so that they may not become actual liabilities, leading the CPSEs to sickness.  In respect of these CPSEs, a rigorous monitoring system through their administrative Ministries has been prescribed, so that potential areas of weakness can be addressed in time to avoid CPSEs going towards sickness.  The CPSEs which have already become sick/ incipient sick, my Department has prescribed time-bound restructuring mechanism.  Prior to this, Board for Reconstruction of Public Sector Enterprises (BRPSE) has been wound up to reduce the number of layers for expeditious decision on restructuring/ revival of CPSEs.  The guidelines prescribed that the CPSEs in high priority sectors need to be supported by the Government while the CPSEs in non-priority sector need to be economically viable to attain self-sufficiency.  The guidelines also prescribe that the administrative Ministries may prepare restructuring/ revival plan which would include disinvestment or privatisation or closure options.  My Department (DHI) has already taken a decision to close 5 CPSEs.  Subsequent to these guidelines, Government has approved a policy for strategic sale of CPSEs.  

Auto Sector 

Contributing 45% to manufacturing GDP, 26% to industrial GDP and 7.1% to the national GDP, a strong pillar of the manufacturing sector, providing 29 million direct and indirect jobs, operating the life line of the economy while integrating the country’s geographical and socio economic diversity, the automobile sector is a vehicle of our journey towards economic prosperity. Although the current change in policy environment and consumer sentiments have brought the industry out from the bottoms, still automobile industry is one of the higher taxed industries in India.

About 49 automobile manufacturers, most of them global companies, and about 1000 auto components manufacturers, a bulk of them from the medium and small industries segment, have partnered India’s industrial rejuvenation. The industry has made investment to the tune of Rs. 70,000 Crore in the last five financial years. The turnover of the industry in FY 2014-2015 was US $ 124 billion. By considering modest 10% growth in the current year, turnover will clock US $ 136 billion, which would mean the Industry would achieve around 94 % of the target set for the industry in Automobile Mission Plan (AMP) 2006-16 till 2016.

Automotive Mission Plan (AMP) 2016-26 has been finalised in consultation with various stakeholders.    In the AMP, which will be  launched shortly, it is aimed that the Indian automotive industry will be among the top three of the world in engineering, manufacturing and export of vehicles and auto components. While growing in value to over 12% of India’s GDP, automobile industry will encompass safe, efficient and environment friendly conditions for affordable mobility of people and transportation of goods in India, which will be comparable with global standards generating more than additional 50 million jobs.

The scheme FAME – India [Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India] was announced in last Budget speech with initial grant of Rs.795 Crores. The scheme was notified in March, 2015 and is under implementation.  The overall scheme is proposed to be implemented over a period of 6 years, till 2020, wherein it is intended to support the hybrid/electric vehicles market development and its manufacturing eco-system to achieve self-sustenance at the end of the stipulated period. The Phase-1 of the scheme shall be implemented over a 2 year period i.e. FY 2015-16 and FY 2016-17 commencing from 1st April 2015. There are initial indications of huge success of this scheme. 

Capital Goods Sector 

Presently manufacturing capacity of units in respect of capital goods are under-utilised to the extent of app. 40% and thus varies from sub-sector to sub-sector.  Technology gaps and imports are the major causes of concern to this sector. Make in India focuses on more and more domestic production and to make investments from within and from abroad. Capital goods sector is one of the important sectors where manufacturing has enough potential. For this purpose, DHI has taken a series of steps i.e. technology development & sector specific infrastructure creation through the scheme viz. ‘Enhancement of the Competitiveness in the Capital Goods Sector’ to enhance the quality and production of machinery and equipment to act as an enabler to make the capital goods sector globally competitive.

Other initiative of the Department is to launch the first ever National Capital Goods Policy. The policy addresses a host of issues of this sector and recommends appropriate measures to allow the sector to grow in a free flowing manner.  The Policy seeks to To enhance production of capital goods by 3 times over the next decade  – from  Rs 2,30,000 Crore to Rs. 7,50,000 crore. It also aims:

1)    To generate additional 22 Million employment opportunities, direct and indirect  (from 8.4 Million to 30 Million)

2)    Promote domestic production of industries

3)    To enhance India’s share to global exports from 0.8 % to 2.5%

To address the under-utilisation of capacity faced by the units, including MSMEs of various sub sectors of capital goods, there is need to correct the inverted duty structure and to make it more favourable to the manufacturers for import of raw materials and technology critical components. Some incentives are required to be provided so that they can compete against imports effectively.

The issues pertaining to Customs, Excise and other issues received in a pre-budget memorandum from the following sub sectors of capital goods had been compiled and recommended to the Finance Minister.

(i)        Machine tools

(ii)      Textile machinery

(iii)    Plastic processing machinery

(iv)    Process plant equipment

(v)      Earthmoving and construction machinery

(vi)    Heavy Electricals Equipment

While some of the issues have been addressed, others are sure to find favourable consideration in due course.

Budget Announcement 2016-17 in respect of sectors under DHI

Capital Goods Sector – Customs Duty       

The following customs duty in respect of the capital goods items have been enhanced from 7.5% to 10% :

(i)     Heavy Electrical equipment sector

S.No. Heading Item Description Duty changed (%)
From To
1 8402 Boilers 7.50 10
2 8404 Auxiliary plant of boilers 7.50 10
3 8406 Steam Turbines 7.50 10
4 8410 Hydraulic Turbines 7.50 10
5 8411 Gas Turbines 7.50 10
6 8412 Engine and Motors 7.50 10
7 84191920 Other heating equipment 7.50 10
8 8501 Motors 7.50 10
9 8502 Generators 7.50 10
10 8503 Parts of motors and generators 7.50 10
11 8504 Transformers 7.50 10
12 8535 Switchgears 7.50 10
13 8536 Switchgears 7.50 10
14 8537 Electrical Panels and CNC Systems 7.50 10
15 8546 Electrical Insulators 7.50 10
16 8547 Parts of Electrical Insulators 7.50 10

The increase in basic customs duty to 10% will enable local manufacturer of Heavy Electrical Equipment including BHEL to become cost competitive. DHI had recommended for enhancement of customs duty for Mega/Ultra Mega power projects in this case. 

(ii)               Earth-moving and Construction equipment sector

CVD has been imposed on the road construction machinery specified in list 16 while BCD remains ‘NIL’. (DHI had recommended in respect of Cone Crusher included at S No. 12 of List 16).

Sl. No. Name of the road construction machinery specified in list 16

 

BCD Change in BCD CVD Change in CVD
1. (1) Hot mix plant batch type with electronic controls and bag type filter arrangements

more than 120 T/hour capacity

(2) Electronic paver finisher (with sensor device) for laying bituminous pavement 7 m

size and above

(3) Slip form/fixed form paver finisher for laying concrete pavement

(4) Surface dressing equipment (self-propelled) (chips spreader)

(5) Slurry seal machine for filling up cracks in roads

(6) Kerb laying machine

(7) Mobile bridge inspection unit

(8) Mechanical broom with blower

(9) Toll collection and traffic control equipment

(10) Electronic Total station instrument for topographic survey

(11) Global Positioning System (GPS) Instrument

(12) Stone crushing (cone type) plants

(13) Hydraulically operated self propelled piling rig with accessories

(14) Hydraulically operated rough terrain self propelled 100 tons crane with telescopic

boom

(15) Hydraulically operated self propelled soil boring equipment with casing pipes for

deep earth anchor

(16) Mobile concrete pump placer of 90/120 cu m/hr capacity

(17) Automatic asphalt extraction equipment

(18) Fully automatic, hydraulically operated, pre-cast segment moulds

(19) Hydraulic gantry crane of 100 tonnes capacity for launching truss

(20) Skid steer loaders

(21) Tunnel Excavation & Lining Equipment consisting of Drilling jumbos, Loaders, Excavators, Shotcrete machine and 3 stage crushers.

Nil No change Nil

(now CVD equivalent to Excise duty,  is applicable on import of these machineries)

The imposition of CVD will enable local manufacturer to become cost competitive against imports.

Capital Goods Sector — Request on Excise Duty

Excise duty in respect of following items has been reduced:

S. No. Description Excise duty Change in excise duty
1 Parts for use in the manufacture of centrifugal pumps

(i)     Shafts

(ii)   Sleeve

(iii) Chamber

(iv) Impeller

(v)   Washer

(vi) Electric motor

12.5% 6%

Impact : Lowering of excise duty on the  above goods will reduce imports of the above items and make the indigenous goods more competitive in market.

Auto Sector

1)      The Union Budget aims to boost the rural economy of the country and the biggest positive in the announcement is the impetus given to the rural, agricultural and infrastructure segment. This will help boost the consumer sentiments of rural India, which had been subdued for more than a year. It seems that an uplifted consumer sentiment will give a much needed boost to the automobile industry.

2)      The budget has focused on the development of the roads, including the national highways and the rural roads alike. An investment outlay of Rs 97,000 crore in the road sector, including PMGSY allocation, has been made for 2016-17. Honourable Finance Minister also informed that as many as 85% of the projects that were stalled, have been re-initiated by the efforts of the Ministry of Road, Transport and Highways. The improved infrastructure would further help the cause of the industry. 

3)      Grant of 200 crores made to the FAME scheme and NATRiP is a welcome step. Moreover, the validity period of exemption granted to specified goods for the use in the manufacture of electrically operated vehicles and hybrid vehicles is being extended without time limit. This will help improve the consumer sentiment around these vehicles and promote faster adoption. 

4)      Basic custom duty on raw material used for manufacture of catalytic converters has been reduced from 7.5 % to 5%. 

DPE has sensitised the Government regarding holding of huge cash and bank balance by the CPSEs with high net-worth and negligible borrowings.  These CPSEs have not leveraged their net-worth for expansion, modernisation or diversification.  This has resulted in FM making the statement that we have to leverage the assets of the CPSEs for generation of resources for investment in new projects.  My Department (DPE) has already taken action in this regard by prescribing high weightage (15-20) for CAPEX/ leveraging net-worth in their MoU guidelines for the year 2016-17.  CPSEs would be monitored not only for CAPEX but also for percentage of CAPEX projects completed without time and cost over-run.  My Department (DPE) has also been assigned the task to monitor CAPEX for infrastructure projects.  This has led to better spending by the CPSEs on infrastructure projects.  NHAI has already achieved more than 100% of its target (2015-16) by January 2016.

DPE has also sensitised the Government that although CPSEs have huge cash and bank balance, inadequate CAPEX plans and they have not given dividend as per their capacity and earning interest by parking the funds in the banks.  It was also highlighted that these CPSEs need to go for buy back of the shares.  This issue has been duly captured by the FM in his speech by stating that we will adopt a comprehensive approach for efficient management of Government investment in CPSEs by addressing issues such as capital restructuring, dividend, bonus shares, etc.  The Government has so far issued guidelines on dividend as percentage of profit after tax or paid-up share capital.  However, it is the net-worth which is known as shareholders fund.  Hence, returns need to be compared with reference to earning on net-worth.  My Department has already taken action by prescribing weightage for ratio of profit after tax to net-worth and dividend to net-worth with combined weightage of 15 in MoU guidelines 2016-17.

  1. Performance of CPSEs as per Public Enterprises Survey 2014-15.
  • Objectives of Public Sector Enterprises include broad macro- higher economic growth, self-sufficiency in production of goods and services, long term equilibrium in balance of payments and low and stable prices besides meeting certain socio-economic obligations.
  • Number of CPSEs as per latest Public Enterprises Survey are 298 While there were only five Central Public Sector Enterprises (CPSEs) with a total investment of Rs.29 crore at the time of the First Five Year Plan, there were are 298 CPSEs (comprising 63 under-constructions and 235 operating).

 There are 7 Maharatna, 17 Navratna and 73 Mini Ratna CPSEs. 

  • Number of profit making CPSEs is 157. Number of loss making CPSEs is 77 and one CPSE has neither incurred profit nor loss as on 31st March, 2015. Top three profit making CPSEs are ONGC, CIL and NTPC contributing 22.72%, 17.15% and 13.19% respectively to the total profit earned by profit making CPSEs.
  • Total investment in all CPSEs is Rs.10, 96,057 crore as on 31st March, 2015 which is 10.48% higher than total investment of Rs. 9, 92,096 crore as on 31st March, 2014.
  • Total income of all CPSEs is Rs.19, 65,254 crore as on 31st March, 2015 which is 3.40% lesser than total income of Rs. 20, 56,336 crore as on 31st March, 2014.
  • Reserves and Surplus of all CPSEs went up from 7, 46,994 crore in   2013-14 to Rs. 7, 71,672 crore in 2014-15 registering a growth of 3.30%. 
  • Net worth of all CPSEs went up from Rs. 9,45,717 crore in 2013-14 to Rs. 9,84,692 crore in 2014-15 registering a growth of 4.12% 
  • Profit of profit making CPSEs stood at Rs. 1,30, 963 crore during 2014-15 compared to Rs. 1, 49,636 crore in 2013-14 showing a decline in profit of 12.88%. 
  • Loss of loss making CPSEs stood at Rs. 27,360 crore during 2014-15 compared to Rs. 21,341 crore in 2013-14 showing an increase in loss by 28.20%. Top three loss making CPSEs are BSNL, Air India Ltd. and MTNL. 
  • Number of listed CPSEs are 46 out of which 45 are being traded. Total market capitalisation of 45 traded CPSEs on stock exchanges of India as on 31.3.2015 stood at Rs. 13,27,127 crore as against Rs. 11,02,730 crore as on 31.3.2014 showing an increase by 20.35%.
  • Contribution of CPSEs to Central Exchequer by way of excise duty, customs duty, corporate tax, interest on central government loans, dividend and other duties decreased from Rs. 2,20,982 crore in 2013-14 to 2,00,585 crore in 2014-15 showing a decline of 9.23%
  1. Streamlining of the mechanism for revival and restructuring of sick/incipient sick and weak CPSEs. 
  • Winding up of Board for Reconstruction of Public Sector Enterprises (BRPSE) has been done by Government in November 2011 to reduce the number of layers for expeditious decision on restructuring/ revival of CPSEs. 
  • 68 cases were referred to BRPSE in the past. BRPSE gave recommendation in 64 cases (revival of 58 CPSEs and closure of 6 CPSEs). Remaining 4 cases (Hindustan Fertilisers Corporation of India Ltd., Fertilisers Corporation of India Ltd, Bird Jute & Export Ltd. and Nagaland Pulp and Paper Co. Ltd.) were remitted to concerned Ministry/Department for resubmission.
  • Breakup of 68 cases referred to BRPSE, cases approved by Government for revival and for closure after BRPSE’s  recommendation is given  below:
Sl. No. Particulars No.
1. Cases referred to BRPSE 68
2. Cases remitted 4
3. No. of cases recommended (revival:58;closures:6) 64
4. No. of cases Govt. approved (revival:46;closure:9) 55
5. Case approved by the Government after winding up of BRPSE (One case of Brahmaputra Valley Fertilizer Corpn. Ltd. has approved on 21.05.2015.) 1
6. Remaining cases yet to be approved 8

  • Guidelines on streamlining the mechanism for revival and restructuring of sick/ incipient sick and weak Central Public Sector Enterprises (CPSEs)
    have been issued in October 2015 by DPE-Annexure IV.  A criterion has been laid down in the said guidelines for identifying the CPSEs as sick, incipient sick and weak CPSEs.
  • The administrative Ministries/Departments shall classify CPSEs functioning under their control into sick, incipient sick and weak CPSEs within 6 months of the closure of financial year or within one month from finalisation of Annual accounts, whichever is earlier.
  • Formulation of revival/restructuring/closure road map for sick CPSEs in a time bound manner has been prescribed in guidelines .
  • This has happened for the first time that Government would identify the CPSEs, which are prone to sickness, before they actually become sick/ incipient sick by identifying their weaknesses and taking remedial measures.
  • In respect of these CPSEs, a rigorous monitoring system through their administrative Ministries has been prescribed, so that potential areas of weakness can be addressed in time to avoid CPSEs going towards sickness.
  • Government has approved a policy for strategic sale of CPSEs and NITI Aayog has been given the responsibility to identify CPSEs for strategic disinvestment, mode of sale, percentage of shares to be sold and methods of valuation of CPSEs.  DPE would be associated in the capacity of member of Core Group of Secretaries and member of Evaluation Committee for Strategic Disinvestment.
  • To leverage the assets of CPSEs for generation of resources for investment in new projects Finance Minister has announced in the budget speech that Government will encourage CPSEs to divest individual assets like land, manufacturing units, etc. to release their asset value for making investment in new projects. A Committee to deliberate on Policy on transfer or alienation of land owned by Government and Government controlled Statutory Authorities & PSUs has been set up in the Department of Economic Affairs under the chairmanship of Secretary, Department of Economic Affairs, Ministry of Finance and having members from Department of Public Enterprises, DEITY, Ministry of Defence, Railway Board and Department of Land Resources.  A separate portal on the same lines would be created for the PSU lands wherein information about all lands owned by PSUs will be kept and maintained DPE.

III.             Enhanced role of DPE in monitoring the performance of CPSEs.

  • Amendment of  Government of India (Allocation of Business) Rules, 1961 has been done  vide Presidential Notification  in August 2015 (Annexure V) to enhance the role of DPE in monitoring of performance of CPSEs, effective management of their assets and capacity building in Good Governance practices by allocating some  additional subjects particularly Review of capital projects and expenditure in Central Public Sector Enterprises, Measures aimed at improving performance of Central Public Sector Enterprises and other capacity building initiatives of Public Sector Enterprises and Rendering advice relating to revival, restructuring or closure of Public Sector Enterprises including the mechanisms therefor.
  • Revised MoU guidelines for 2016-17 issued in December 2015 (Annexure VI) with an objective to have stringent evaluation of performance of CPSEs under MoU system. DPE has sensitised the Government that although CPSEs have huge cash and bank balance, inadequate CAPEX plans and they have not given dividend as per their capacity and earning interest by parking the funds in the banks.  It was also highlighted that these CPSEs need to go for buy back of the shares.  This issue has been duly captured by the FM in his speech by stating that govt. will adopt a comprehensive approach for efficient management of investment in CPSEs by addressing issues such as capital restructuring, dividend, bonus shares, etc.  The Government has so far issued guidelines on dividend as percentage of profit after tax or paid-up share capital.  However, it is the net-worth which is known as shareholders fund.  Hence, returns need to be compared with reference to earning on net-worth.  DPE has already taken action by prescribing weightage for ratio of profit after tax to net-worth and dividend to net-worth with combined weightage of 15 in MoU guidelines 2016-17.
  • Monitoring of CAPEX projects of CPSEs and also the percentage of CAPEX projects completed without time and cost over-run is being done by DPE.  This has led to better spending by the CPSEs on infrastructure projects.  Besides DPE has prescribed high weightage (15-20) for CAPEX/ leveraging net-worth in MoU guidelines for the year 2016-17.
  • The details of CAPEX projects of 33 CPSEs, Railway Board and 4 other organizations namely Delhi Metro Rail Corporation, Damodar Valley Corpn., Singreni Colleries & NHAI being monitored by DPE are as under:
  CAPEX Target 2015-16 Achievement (Till Feb) % Achievement
33 CPSEs 200217.86 141193.20 70.52
Railway Board NA 64160.00  
Other 31301.03 40991.81 130.96

CPSE wise/organization wise details of CAPEX plan targets for 2015-16 and achievement upto 29.02.2016 are at Annexure VII.

  1. Corporate Social Responsibility (CSR) 
  • As per Section-135 of Companies Act, 2013, all profit making corporates, including Central Public Sector Enterprises (CPSEs) fulfilling threshold limits with regard to net worth of Rs. 500 crore or more, or turnover of Rs. 1000 crore or a net profit of Rs. 5 crore or more prescribed in the Act are mandated to spend 2% of the average net profits (Profit Before Tax) of the company made during the three immediately preceding years in pursuance of its CSR Policy. Schedule-VII of the Act, indicates the activities that can be undertaken by CPSEs under their CSR for welfare of the society at large in a sustainable manner.
  • DPE has issued Guidelines on Corporate Social Responsibility (CSR) & Sustainability-2014 for CPSEs in October, 2014.
  • Main focus of DPE guidelines provide focus on sustainable development and inclusive growth, and to address the basic needs of the deprived, under privileged, neglected and weaker sections of the society which comprise of SC, ST, OBCs, minorities, BPL families, old and aged, women / girl child, physically challenged, etc. CPSEs should give priority to the issues which are of prime concern in the national development agenda, like safe drinking water for all, provision of toilets especially for girls, health and sanitation, education, etc.
  • Activities/ projects under CSR, including its location and the amount to be spent thereon are decided by CPSEs with the approval of their Boards in the thrust areas as per the list of items provided in Schedule-VII of the Act. The responsibility of monitoring the implementation is with the Boards of respective CPSEs and the administrative Ministries / Departments concerned.
  • DPE issued advisory to CPSEs in November, 2014 to contribute towards ‘Swachh Bharat Kosh’ and ‘Clean Ganga Fund’ set up by Central Government for sanitation and rejuvenation of river Ganga under their Corporate Social Responsibility (CSR). CPSEs are also undertaking construction of toilets in rural and urban schools, toilets in girls’ schools and community toilets in the villages under Swachh Bharat Mission and Swachh Vidyalaya Abhiyan.
  • Four CSR Conclave/ Seminar/Workshop in Guwahati, Imphal, and Bangalore and New Delhi organised to sensitize senior level executives of CPSEs on handling and implementation of CSR.
  • As announced by  Finance Minister in his Budget Speech, 2016, Government has decided to set up a Higher Education Financing Agency (HEFA) with an initial capital base of Rs.1000 crores.  The HEFA will be a not- for – profit organization that will leverage funds from the market and supplement them with donation and CSR funds.  These funds will be used to finance improvement in infrastructure in top institutions and will be serviced through internal accruals.  The modalities of implementation of this scheme shall be worked out by Government in due course.
  • As per available information in respect of 121 CPSEs, the 2% of average PBT for these 121 CPSEs for 2014-15 works out to be Rs. 3479.80 crore. Against this, the total CSR spending in 2014-15 for these 121 CPSEs is Rs. 2443.00 Crore. 
  • Cabinet Secretariat under “e-Samiksha” has stipulated that CSR spending on Swachh Bharat should go up to 75%. So far out of total CSR expenditure of Rs. 2443.00 crore, the amount spent on sanitation is Rs 339.73 crore and towards Swachh Bharat Kosh is Rs. 105.39 crore totalling to Rs. 445.12 crore. This constitutes 18.22% of the total CSR spending.
  1. Minimum Government Maximum Governance/ Good governance practices. 
  • Action for filling up of Non-Official Directors -Names for filling up 206 positions of non-official Directors in various CPSEs suggested based on 8 meetings of Search Committee. 
  • Creation of 9 posts of full time Directors has been done in BIRAC, Air India Ltd, Pawan Hans Ltd and Bharat Petro Resources Ltd. CPSEs to improve the functioning of these CPSEs.
  • Grant of Navratna Status to three CPSES namely (i) Container Corporation of India Limited, (ii) Engineers India Limited and (iii) National Buildings Construction Corporation Limited were granted Navratna status enabling the Boards of these CPSEs to exercise delegated operational and financial powers.
  • Rationalisation of old/obsolete BPE/DPE guidelines done after a review of approx. 635 such guidelines a revised Compendium containing 320 guidelines has been published in 2016 for the benefit of CPSEs and their concerned administrative Ministries/Departments. This compendium has been published after a gap of almost ten years.
  • Permanent Machinery of Arbitration set up in DPE exists to curb unnecessary Government litigations and to avoid delay in resolving disputes related to CPSEs. Guidelines to desist from filing litigation in the Courts and to adopt available mechanism for settlement of disputes through (PMA) or through inter-ministerial process has been issued to all CPSEs and their concerned administrative Ministries/Department.
  • In line with extant Government instructions, CPSEs have been advised to discontinue the process of interviews for recruitment to Non-Executive level posts in CPSEs.
  • CPSEs have also advised to conduct Periodical performance review for ensuring probity and efficacy among employees of CPSEs so that inefficient   and corrupt officials can be weeded out.
  • Under “Accessible India Campaign” the CPSEs have been advised to undertaken accessibility audit of their infrastructure and for making the built up environment accessible for Persons with Disability (PwD). 
  1. Workshops & training programmes. 
  • Two-day International Workshop on “Governance of State-Owned Enterprises” on 18th and 19th December, 2015 organised in New Delhi with the support of World Bank. The workshop was attended by more than 150 participants from various CPSEs, Ministries, and academicians and had Government representatives/experts from 8 countries, viz. China, Brazil, Afghanistan, Bangladesh, Bhutan, United States, United Kingdom, South Korea.
  • For capacity building of non-official and Government Directors of CPSEs about their role and responsibilities in the context of newly enacted Companies Act, 2013 and important issues related to better functioning of Boards 4 workshops organised at Imphal, Goa, and New Delhi.
  • Nine training programmes for 275 Executives of State Public Enterprises were organised in Centres of excellence such as IITs, IIMs IIPA, Delhi etc. under RDC scheme.
  • Under CRR scheme, approx. 2940 VRS/VSS optees or their dependents have been imparted skill development trainings through 21 Employee Assistance Centres of 9 Nodal Agencies in 2015-16 to enable them to take up self-employment/redeployment. 

VII.          Miscellaneous:

  • DPE has a sanctioned strength of 122 personnel against which present incumbency position is 73 (Annexure XII). DPE has accorded significant importance to “Swachh Bharat Campaign” which began from 25th September 2014.  All the officers/staff have been sensitized from time to time about the importance of cleanliness in and around office premises.  During the campaign period 40,000 pages were digitized and 2,500 files were weeded out.   Waste and obsolete items along with three old vehicles, which were lying condemned for a long time were disposed of as per extant rules.
  • Figures of Budget Estimate 2015-16, Revised Estimate 2015-16, Expenditure as on 29.02.2016 and Budget Estimate for 2016-17 are as under:

(Rs. In crore)

BE 2015-16 RE 2015-16 Expdt. As on 29.02.2016 BE 2016-17
Plan Non-plan Plan Non- plan Plan Non-Plan Plan Non- Plan
9.00 10.00 7.92 10.26 5.81 9.25 10.00 10.42

Source Ministry of Heavy Industries & Public Enterprises 08-March, 2016

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