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CPSEs: Question of how to become lean without mean

By Mukul Shukla & Rakesh Ranjan- 07 Sep 2020


Central public sector enterprises have started the process of becoming lean and mean by identifying, and getting rid of, unproductive human resources. In this regard, they are following the process initiated by the central government to retire 'duds' at 50 or 55.

If the process is meant to improve the productivity and profitability of the CPSEs, it's not clear how this objective may be achieved in view of the objectively acknowledged facts that much of the problems hurting the performance of the taxpayers-owned companies stem from years of acts of omission and commission of the political dispensation.

According to official information provided under the RTI Act to some individuals, the Cabinet has cleared the idea of strategic divestment in as many as 26 CPSEs that include PDIL, EPIL, Pawan Hans Limited B&R Company Limited, Air India, Central Electronics Limited (CEL), Cement Corporation India Limited, CCIL (Nayagaon unit), IMPCL, Salem Steel Plant, Bhadrawati Steel Plant, Durgapur Steel plant, Ferro Scrap Nigam Ltd. (FSNL), Nagarnar Steel Plant of NDMC, Bharat Earth Movers Limited, HLL Lifecare, BPCL, Shipping Corporation of India, Container Corporation of India Ltd(CONCOR), Nilachal Ispat Nigam Ltd, Hindustan Prefab, Bharat Pumps and Compressors, Scooters India Ltd(SIL), Hindustan Newsprint Ltd(HNL), KAPL, Bengal Chemicals & Pharmaceuticals Ltd. (BCPL), Hindustan Antibiotics Ltd., Indian Tourism Development Corporation (ITDC), Hindustan Fluorocarbon Ltd (HFL).

Indianmandarins has learned that the grand plan is to reduce the liability part of the assets of these companies by reducing human resources and shoring up the bottom line.

In this regard, BEL, for instance, had recently issued a circular asking its officials to prepare a list of unproductive personnel below the board level from both executive and non-executive categories whose services may be dispensed with by giving them a three-month advance notice or the salaries for three months in lieu of notice.

If BEL succeeds in its experiment, the chosen 26 CPSEs may follow in its footsteps.

But the big question is: will BEL succeed. Can the CPSE managements prevail over the entrenched unions?

(By Mukul Shukla & Rakesh Ranjan)

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