The Hindu Business Line : AP public enterprise reforms yield Rs 485-cr revenue

THE public enterprise reforms initiated in Andhra Pradesh have led to major benefits for the State Government in the form of savings, improved returns for farmers for their produce, while regenerating economic activity in units that were either closed or faced certain closure.

According to the Implementation Secretariat (IS) that is spearheading the public enterprise reforms in the State, the benefits that accrued established credibility of the reforms programme, which, in turn, led to building investor confidence in Andhra Pradesh as an investment and business destination.

In a latest newsletter, the IS said the reforms have, so far, generated revenue of Rs 485.5 crore from the process completed in respect of 55 enterprises. Of this, Rs 262 crore has come from the sale of assets of the enterprises restructured or closed and the remaining Rs 223.5 crore was realised from the disinvestment of the Government's stake in seven listed companies.

Of the 55 units in which reforms were completed, disinvestment was completed in nine units, 12 were privatised and 12 were restructured. The remaining 22 were closed down.

In terms of concrete benefits, the savings achieved by the Government as a direct result of the reforms carried out in the State-run enterprises were estimated at Rs 1,552 crore after netting off the cost related to VRS and debt resolution over the next five years, the IS communiqué said.

According to the figures made available by the IS, the annual estimated saving to the State finances would be around Rs 316 crore after including Rs 50 crore given to Nizam Sugars Ltd through inter-corporate loans. The State was also estimated to save Rs 497 crore in the next five years on its commitment for guarantees to be issued during the next five years.

"Even the co-operative spinning mills at Adilabad, Rajahmundry and Parchur are now privatised and showing improved performance. Now they are earning profits and paying taxes, unlike earlier when they kept asking for Government funds," the Implementation Secretariat said.

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