The shipping ministry has strongly opposed strategic sale in Shipping Corporation of India (SCI) and some ports under its watch, joining a number of other ministries that are not keen on selling state-run enterprises that they govern. This follows the government’s recent ‘in-principle’ approval for stake sale in Air India.
The shipping ministry has raised objections to privatise Shipping Corporation and some government-owned ports, including Tamil Nadu-based Kamarajar Port. Some other ministries that had earlier opposed divestment plans include the health ministry and the heavy industries ministry but the government’s premier think tank, NITI Aayog, overlooked their opposition and recommended privatisation in some cases.
The government has set itself a disinvestment target of Rs.72,500 crore for this fiscal, of which Rs. 15,000 crore is to come through strategic sales. So far this fiscal, the government has raised around Rs. 6,800 crore, which includes selling its stake in L&T held through SUUTI. Two senior government officials confirmed the development and said the government may reconsider its decision on the proposed divestment.
The government currently holds 63.75% stake in Shipping Corporation and 66.67% in Kamarajar Port. A senior Shipping ministry official told ETthat shipping minister Nitin Gadkari has strongly opposed the divestment of SCI on grounds it is not only profitable but the proceeds are also reinvested in capacity building in areas where the private sector shy away from investment.
“The government wants to do Sagarmala project and inland waterways and there is hardly any budgetary allocation to these two areas. Our plan is to invest profit from ports in development of coastal areas and make inland rivers navigable,” said the above-quoted official. Last fiscal, all 12 major ports owned by the government posted a profit of Rs.5,000 crore. Shipping Corporation has also been in profit in the last two years.
“The terminals on ports are already operational under the built-operate-transfer (BOT) mode. The government owns only the land and water breaks. What’s the point of privatisation,” he said, adding that the NITI Aayog should have given more thought before making such suggestions.
