Tanka Mani Sharma, joint secretary at the Ministry of Finance (MoF), said shares of Dairy Development Corporation (DDC), Herbs Production and Processing Company Ltd (HPPCL), Hetauda Cement Factory (HCF), Nepal Drug Ltd (NDL), National Seed Company Ltd (NSCL), National Trading Ltd (NTL), Gorkhapatra Corporation (GC) and Agriculture Input Company Ltd (AICL) will be offered to the public.[break]
The government had in the current year´s budget announced the policy for effective implementation of divestment to increase people´s ownership through open sale of the shares of state-owned enterprises and hydropower projects to be built by such enterprises.
"We have come to the conclusion to divest the shares of those PEs to institutions after a couple of meetings with chief executives and after studying their financial details. Those PEs have been selected on the basis of people´s involvement and attachment with them," Sharma told Republica on Thursday.
Sharma informed that local community institutions such as farmers´ groups, community forest users´ groups and dairy producers´ cooperatives can buy the shares. "Stakes of those PEs will ultimately go to grassroots people through the institutions," said Sharma, who is also the chief of Public Enterprises Coordination Division at the MoF.
He said the government would complete all decision-making process on the matter by mid-July before the announcement of new budget for the fiscal year 2010/11.
Among the PEs selected for divestment, DDC, HPPCL, AICL and GC had suffered losses during the fiscal year 2007/08. Similarly, revised estimate showed losses in DDC, HPPCL, HCL, AICL and GC where as all PEs except HPPCL had set targets to earn profits.
He also said the government will take decision in the next phase about the fate of National Productivity and Economic Development (NPED), Nepal Orind Magnesite (NOM) and Nepal Metal Company (NMC) which are being run on public-private partnership basis.
"We are exploring better ways to effectively run NMC and NOM as both companies have huge potentiality to expand markets within and outside the country," he added.
Govt dissolves NCCN
The government has decided to virtually dissolve the five-decade-old National Construction Company Nepal (NCCN), a government own builder, sending over a hundred employees into payoff. The Ministry of Finance (MoF) decided to liquidate the company keeping in view with the continued losses of the company for last six years.
"We took the decision not to continue the loss making company as it failed to compete with the private companies in bidding for construction in the absence of government privilege for it," Tanka Mani Sharma, joint secretary, told Republica.
At least Rs 70 million is needed to clear the dues of 104 employees including 38 permanents. "The company will be closed virtually but legally it will continue to exist with a few staff at its office at the Ministry of Physical Planning and Works," said Sharma.
According to MoF, NCCN had suffered a loss of Rs 16.3 million and Rs 16.6 million in 2007/08 and 2008/09, respectively. The government has invested Rs 69 million in the company which was established in 1961 with objectives of speeding up civil works in the country.
Tribendra Raj Pant, general manager, said the company becam financially paralyzed due to the lack of government´s policy which failed to ensure contracts for state-run projects.
"We had distributed even bonus to the employees in 2000 when we had sufficient work. How can we survive when the government hasn´t given even a single contract for us in the last six years," said Pant.
Pant expressed dissatisfaction over the acquisition of company´s 316 ropanies of land in Halchowk of Kathamudu by the government at a negligible price. Currently, the company has five kathas in Hetauda and 26 ropanies of land in Pokhara.
The company has invested Rs 30 million in Citizen Investment Trust and the government has a due of Rs 80 million to the company.
Despite, poor financial position, the company has assets worth Rs 240 million against its liabilities of Rs 120 million.
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