Anant Geete highlights Initiatives & Achievements of Heavy Industry & Public Enterprises Ministry

Heavy Industry
Heavy Industry

Union Minister of Heavy Industry & Public Enterprises Shri Anant G. Geete  gave an account of the initiatives and achievements of his ministry during the last two years here in New Delhi. Shri Geete said the main achievements of this Department since May 2014 can be broadly categorised under four major headings, briefly summarised as under:

The Department of Heavy Industry is concerned with the development of the Heavy Engineering and Machine Tools Industry / Heavy Electrical Engineering Industry and Automotive Industry. It administers 31 Central Public Sector Enterprises and three autonomous bodies.

(A) –Automotive Industry

FAME India Scheme: This Department has notified a scheme namely FAME – India (Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India) to encourage progressive induction of reliable, affordable and efficient electric and hybrid vehicles (xEV) with effect from 1st April 2015 for the initial period of Two years. This scheme is one of the Green initiatives of the Government aiming at cumulative fuel savings of about 9500 million litres (Value over Rs. 60000 crore by 2020). Aligned with the Make in India initiative, the scheme aims that India emerge as a leader in the xEV 2- Wheeler and 4-Wheeler market in the World by 2020.

The purpose of the scheme is to encourage faster adoption (market creation and related activities), domestic technology development (Research & Development) and manufacturing of full range of cleaner electric vehicle technologies that include mild hybrid, full hybrid vehicles (HEVs), Plug in Hybrids (PHEVs) and Pure Electric Vehicles (PEVs) (collectively termed as xEVs) thereby leading to creation of a strong, globally competitive, viable & self-sustaining electric vehicle industry and its eco system in India. This is a key initiative which is a palliative for environmental concerns due to use of fuels.

2. Automotive Mission Plan (2016-26)

• The vision of AMP 2026 is

“By 2026, the Indian Automotive industry will be among the top three of the world in engineering , manufacture and export of vehicles and components, and will encompass safe, efficient and environment friendly conditions for affordable mobility of people and transportation of goods in India comparable with global standards, growing in value to over 12% of India’s GDP, and generating an additional 65 million jobs.”

• The salient features of AMP 2026 are

– The Indian Automotive industry to be a top job creator – 65 million additional jobs.

– The Indian Automotive industry to be the prime mover of Manufacturing sector and “Make in India” Programme.

– The Indian Automotive industry to aim at increasing exports of vehicles by 5 times and Components by 7.5 times.

– For success of AMP 2026, there is a need of coordinated and stable policy regime for the automotive sector.

– Specific interventions are envisaged to sustain and improve manufacturing competitiveness and to address challenges of environment and safety.

– AMP 2016-26 is proposed to be launched by Prime Minister

NATRiP
3. The National Automotive Testing R&D Infrastructure Project (NATRiP) envisages setting up of world class automotive testing and homologation facilities in India with a total investment of Rs.2288.06 crore by 31st Dec. 2014. However due to various reasons project came to a standstill resulting time and cost overruns, court cases on contractual issues and other critical issues. With efforts of the Department and NATRiP, during the last 2 years, most of the critical issues have been resolved, contracts worth Rs.740 crore. The NATRiP project was brought on track and Union Cabinet approved the extension of NATRiP Project from 1st January 2015 to December 2017 with a revised cost estimate of Rs.3700 crore. NATRiP has completed the following facilities at different centres:-

* Power Train:
(a) Mileage Accumulation Chasis Dynamometer (MACD) for 2W, 3W & 4W at ARAI, Pune.
(b) Engine Test cell (ETC) for Heavy Duty and Light Duty Engines at ARAI, Pune and ICAT, Manesar.
(c) Sealed Housing Evaporation Determination (SHED) facility for 2W, 3W and 4W at ARAI, Pune.
(d) Vehicle Test Cell (VTC) for 4W at ARAI, Pune.

4. The Minister (HI&PE) inaugurated five facilities at GARC, NATRiP, Chennai on 27th August, 2015. With the inauguration of these facilities, more world class auto testing and homologation facilities created under the NATRiP project are now available to the auto industry.

5. The Minister (HI&PE) inaugurated ICAT, Manesar on 23rd February 2016 with four test facilities i) Climate Vehicle Test Cell (CVTC); (ii) Computer Aided Design & Computer Aided Engineering (CADCAE); (iii) Engine Test Cell (ETC) and; (iv) Infotronics Lab under NATRiP.

(B) Heavy Engineering and Machine Tools (HE & MT) :
6. A Memorandum of Understanding (MoU) between the Department of Heavy Industry, Government of India and Fraunhofer – Gesellschaft, Germany on cooperation for technology resourcing in the field of Capital Goods was signed on 5th October, 2015 during the visit of the German Chancellor to India from 4th to 6th October, 2015. Fraunhofer Society (Gesellschaft) is a German applied research organization of global repute. The objective is to support and augment the “Make in India” programme through increasing the innovation and technology prowess of Indian industry. A similar MOU has also been signed with M/S Steinbeis , Germany for technology partnership.

In addition, DHI launched its Technology Acquisition Fund Programme (TAFP) in association with Global Innovation and Technology Alliance (GITA), a technology body set up by Department of Science and Technology and CII.
WIN India, India’s leading industrial and engineering trade fair, organised by Hannover Milano Fairs India (HMFI) Pvt. Ltd, was held in partnership with DHI from December 9-11, 2015 in New Delhi.

7. A National Policy on Capital Goods was formally announced by the Minister (HI&PE) on 15th February, 2016 during the ‘Make in India Week’ in Mumbai. The policy has got approval from cabinet after extensive industry and stakeholders consultations. The policy has been launched in fulfilment of commitment made before the PM. Some of the important recommendations made in the policy are as below:
(i) To integrate with Make in India initiative:
(ii) To create an enabling scheme as a pilot for ‘Heavy Industry Export & Market Development Assistance Scheme (HIEMDA)
(iii) To Strengthen the existing Capital Goods scheme
(iv) To launch a Technology Development Fund under PPP model to fund technology acquisition
(v) To create a ‘Start-up Center for Capital Goods Sector’
(vi) To ensure Mandatory Standardization
(vii) To upgrade development, testing and certification infrastructure.
(viii) To enhance Skill development: to set up 5 regional State-of-the-Art Greenfield Centers of Excellence for skill development of CG sector.
(ix) To provide schemes for enhancing competitiveness through a cluster approach
(x) To modernize the existing CG manufacturing units, especially SMEs
(C)Requirement for Schemes on Capital Goods— Rs. 2000 to 3000 cr

8. CRITICAL PROJECTS APROVED UNDER THE CG SCHEME

As an initiative under “Make in India”, setting up of a world class Machine Tool Park at Tumkur in collaboration with Government of Karnataka, in coordination with IMTMA approved. The project cost of Rs 421 crore will be partially met from the Government of India grant support of Rs 125 crore. When implemented fully, the park is expected to double Indian turnover of machine tools to Rs.9000 crore, with matching saving in imports/ forex.

Creation of Centre of Excellence (COE) at Indian Institute of Technology, Madras (IIT-M) for development of Machine tool Technologies.

Creation of Centre of Excellence (COE) at PSG College of Technology, Coimbatore for development of welding Technologies.

Technology support sought by HMT Machine Tools Limited from M/s Fraunhofer of Germany, under Technology Acquisition Fund Programme

Common Engineering Facility Centre for electro slag re-melting, welding, gear box manufacturing and non-destructive testing by HEC

Creation of Centre of Excellence at CMTI, Bangalore for Development of Advanced technologies for hi-tech Shuttle less Looms (Textile Machinery)

Creation of Common Engineering Facility Centre for hi-tech tools, dies and moulds by TAGMA
(D) Central Public Sector Enterprises (CPSEs):
9. Major Achievements:-

BHEL has retained its leadership position in a shrinking & highly competitive market during last two years with 72% share in Indian Power sector business for the second consecutive year.

BHEL joined the elite club of select global giants having installed base of over 150 GW of power generating equipment for 3rd Year in a row.

BHEL secured orders worth Rs.74,541 crores from Power & Industry segments covering both domestic & international markets in last two years.

BHEL has signed an MoU with the newly formed Telangana State for 6000 MW Power projects.

BHEL has commissioned/synchronized Power projects totaling 27000 MW during the last 2 years.

BHEL has manufactured the first indigenously 660 MW supercritical thermal set commissioned at NTPC Barh, and first indigenously manufactured 800 MW supercritical boiler commissioned at Krishnapatnam.

BHEL has achieved a major milestone of the year by commissioning of power plants in Ethiopia, Oman, Rwanda and Sudan totaling to 319 MW. In 2015-16, it also forayed into new markets with maiden orders from Belgium and Mozambique, expanding its global footprint to 78 countries.

During the year BHEL set a new record in its Solar PV business in a single year by setting up of 480 MW Integrated Solar PV Manufacturing Facility at Bhandara, Maharashtra. At a time when the country is considering large scale-up plan for Solar PV Energy i.e. 100 GW by 2022, this manufacturing facility assumes significance by enhancing domestic manufacturing base.

BHEL has commissioned 736 MW hydro projects during the year which is highest in the last 10 years.

BHEL achieved the highest order booking in the last five years, at Rs.43727 crore, a 42% leap over 2014-15.

During the year, BHEL filed the highest ever 477 patents and copyrights in a year, enhancing the company’s intellectual capital to 3,487.

 Andrew Yule & Company Limited (AYCL) and Scooters India Limited (SIL), CPSEs under this Department, which had been under reference to BIFR, were discharged from its purview as their net worth has turned positive.

AYCL was awarded the PSE Excellence Award 2014 for being the Best Turnaround PSU.

 HMT (Machine Tools) Ltd indigenously developed a multi blade shearing machine to cut the irradiated nuclear fuel bundle into smaller pieces for disposing nuclear waste and to retrieve the weapon grade plutonium. The machine developed by HMT cuts total bundle in one stroke giving 1300% more productivity with improved reliability to work in radioactive area.

HMT (International) Ltd has been awarded an order valued at Rs.14.19 crore to upgrade and modernize the existing facilities of Rajiv Gandhi School of Production & Art (RGSPA) at Ulaanbaatar, Mongolia on request from the Government of Mongolia.

Scooter India Ltd (SIL) has reported a Profit after Tax of Rs.11.08 crore for the year 2014-15, a highest in the history of SIL.

Engineering Project India Ltd (EPI) has successfully completed a prestigious ‘Engineer-3 Project’ Phase-I (valuing US$ 255 Million) in Oman. The Phase-II of this project (valuing US$ 470 Million) has also been awarded to EPI in June, 2015. This is the highest value order ever received by EPI.

igning of MoU between HEC and M/s Paul Wurth, Luxembourg in the presence of HE the Dy PM of Luxembourg and Minister HI&PE.

The Braithwaite Burn & Jessop Construction Company Ltd (BBJ) has completed supply, fabrication & erection of Open Web Steel bridges over river Torsha & Jaldhacca at West Bengal for North Frontier Railway, Open Web Steel bridge over river Khatjodi at Odisha for RVNL, Open Web Steel bridge over river Gandak at Bihar for East Central Railway and 4 KM long Rail cum Road bridge over river Ganga at Munger, Bihar for East Central Railway. The last bridge was inaugurated by Hon’ble Prime Minister of India on 12.03.2016.

Despite the down turn in the economy of the country, the Cement Corporation of India (CCI) has achieved higher capacity utilization, production and turnover during the last two years. Two loss making plants at Rajban in Himachal Pradesh & Bokajan in Assam have turned into profit.

The Minister said apart from growth registered by CPSEs, it has been a conscious effort of DHI to put to optimal use the assets of its CPSEs. Accordingly, approval has been obtained for giving a golden handshake to employees followed by closure of 5 CPSEs, viz. TSPL, HMT Bearings, HMT Watches, HMT Chinar Watches and Hindustan Cables Limited. This is likely to free up valuable land assets for greater public use. Restructuring proposals are under active consideration for HEC, HPC and HEC Limited.

The Minister said The Department of Public Enterprises (DPE) is the nodal department for all the Central Public Sector Enterprises (CPSEs) and formulates policy pertaining to CPSEs. It lays down, in particular, policy guidelines on performance improvement and evaluation, autonomy and financial delegation and personnel management in CPSEs. It also collects and maintains information on several areas in respect of CPSEs.

The Survey on the performance of CPSEs is laid in the Parliament every year during Budget session. The Public Enterprises Survey 2013-14 and 2014-2015 was laid in both the Houses of Parliament on 26.2.2015 and 26.2.2016 respectively.

Some of the highlights of the performance of CPSEs are given below:

(i) Number of CPSEs as per latest Public Enterprises Survey are 298 while there were 277 CPSEs in 2012-13.
(ii) 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.

(iii) Reserves and Surplus of all CPSEs has gone up from 7, 46,994 crore in 2013-14 to Rs. 7, 71,672 crore in 2014-15 registering a growth of 3.30%.

(iv) Net worth of all CPSEs has increased from Rs. 9,45,717 crore in 2013-14 to Rs. 9,84,692 crore in 2014-15 registering a growth of 4.12%.

(v) Number of CPSEs being traded is 45. 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%.

(vi) Contribution of CPSEs to Central Exchequer by way of excise duty, customs duty, corporate tax, interest on central government loans, dividend and other duties is Rs. 2,00,585 crore in 2014-15.
vii) The ratio of total turnover of Rs. 19,95,902 Crore to the Gross Domestic Products (GDP) of Rs. 125,41,208 Crore at current market price during 2014-15 stood at 15.91 %.The major contribution of the production is coming from petroleum, coal, steel, electricity, power generation and marketing of services.

(viii) In order to streamline the multiple mechanism for revival of sick CPSEs, the Board for Reconstruction of Public Sector Enterprises (BRPSE) has been wound up on 9th November, 2015. DPE has issued on 29.10.2015 guidelines for “Streamlining the mechanism for revival and restructuring of sick/ incipient sick and weak Central Public Sector Enterprises: General principles and mechanism of restructuring” to be followed by the administrative Ministries /Departments in preparation of proposals for revival/restructuring or closure of CPSEs under their administrative control in a time bound manner. For the first time Government would identify the CPSEs, which are prone to sickness. A new category of ‘weak CPSEs’ has been introduced in guidelines issued by DPE to identify CPSEs at an early stage, before they become sick/incipient sick.
In 2015-16 greater emphasis has been given on Corporate Governance/ Professionalization of Boards. (a) The Search Committee meetings were held regularly and names for filling up 231 positions of non-official Directors in various CPSEs recommended. (b) Nine posts of full time Directors were created on the Boards of CPSEs (BIRAC, Air India Limited, Pawan Hans Limited and Bharat Petro Resources Limited) to improve their functioning. (c) Besides, DPE organized four training programmes for capacity building of non-official and Government Directors of CPSEs. The participants were sensitized about their role and responsibilities in the context of newly enacted Companies Act, 2013 and important issues related to functioning of Boards.

Under the DPE’s Plan Scheme of RDC, Management Development Programmes on various topics for increasing the knowledge & skill of executives of SLPEs were organized at various Centre for Excellence such as IIIMs, IITs, IIPA, Delhi etc. During the year 2015-16, nine training programmes have been conducted as against 7 training programmes organized previous year. 275 Executives of State Level Enterprises have been benefited with the said training programmes during the year 2015-16.

Besides above, two workshops were also organized for executives of CPSEs on Companies Act, 2013 and International Financial Reporting Standards (IFRS) and Indian Accounting standards (IND AS):

The Scheme of Research, Development & Consultancies (RDC) has been further rationalized in 2015-16 to undertake thematic studies on the generic issues of general/ sectoral nature concerning public sector enterprises in the fast changing economic scenario of the world, capacity building initiatives through seminars and workshops, training programmes on the generic issues concerning public sector enterprises to adopt collaborative and cooperative learning for experience sharing, constant improvement in performance evaluation and management processes of CPSEs, and promotion of best practices in focus areas through grant of awards/ incentives to CPSEs and SLPEs.

DPE with the support of World Bank and in collaboration with Institute of Public Enterprise organized two-day International Workshop on “Governance of State-Owned Enterprises” on 18th and 19th December, 2015 in New Delhi. The workshop was inaugurated by Minister of Heavy Industries & Public Enterprises and Minister of State in Ministry of Heavy Industries & Public Enterprises was also present in the inaugural session. Chairman, Public Enterprises Selection Board graced the valedictory session. The workshop had 5 technical Sessions, viz. (i) Efficient Governance of SOEs : Models and Practices, (ii) Leveraging SOE Boards for effective decision making, (iii) Benchmarking financial and non-official performance of SOEs in Performance contracting, (iv) Corporate Social Responsibility and SOEs, and (v) SOEs and Global competitiveness : Challenges and Opportunities which were addressed by 18 national and 7 international speakers. The workshop was attended by more than 150 participants from various CPSEs, Ministries, academicians and had Government representatives/experts from 8 countries, viz. China, Brazil, Afghanistan, Bangladesh, Bhutan, United States, United Kingdom, South Korea.

DPE is also implementing a social safety net scheme titled, Counselling, Retraining & Redeployment (CRR) Scheme to provide opportunities of self / wage employment to the employees or dependents of Central Public Sector Enterprises (CPSEs) separated under Voluntary Retirement Scheme (VRS) / Voluntary Separation Scheme (VSS) or retrenched due to closure / restructuring of the enterprise. The Scheme aims at providing short duration skill development/entrepreneurship development training programmes to equip the beneficiaries for self/wage employment. During the last two years, i.e., 2014-15 and 2015-16, skill development/entrepreneurship development training to 5525 separated employees/dependents of CPSEs has been provided through 26 Employees Assistance Centres (EACs) of nodal agencies in the areas/trades such as computer related courses, mobile repairing, welding, motor winding, screen printing, etc. In 2016-17 also training to 3000 separated employees/dependents of CPSEs is proposed. Number of trainees in last two years, i.e., 2014-15 and 2015-16 is approximately 500 more as compared to 2012-13 and 2013-14.
Revised guidelines on MoU system for performance evaluation of CPSEs have been issued on 31.12.2015. Emphasis has been given on result oriented parameters (instead of process oriented) to measure profitability and efficiency – such as capacity utilization, revenue from operations, trade receivable as percentage of revenue from operations, inventory as percentage of sale of products. In addition efficiency parameters (physical operations) have been incorporated which would be evaluated against well-established benchmarks.

The performance of Maharatna and Navratna CPSEs was reviewed by the Inter-Ministerial Committee and Apex Committee. 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.
Allocation of Business Rules in respect of Department of Public Enterprises (DPE) have been amended in August 2015 to enable DPE to monitor CAPEX projects of CPSEs. For the first time 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 higher weightage (15-20) for CAPEX/ leveraging net-worth in MoU guidelines for the year 2016-17.

For the first time after the enactment of Companies Act, 2013 providing for mandatory expenditure of 2% of profit on CSR activities, DPE has started monitoring CSR activities of CPSEs from 2014-15 and an expenditure of approx. Rs. 2448.32 crore have been made by 126 CPSEs.

With the objective of minimum government maximum governance rationalization of old/ obsolete BPE/ DPE guidelines has been done after a gap of about 10 years. 635 such guidelines were reviewed and a Compendium containing 320 guidelines has been published in January 2016.

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