The central government will not consider any requests from stakeholders to stop the privatisation process of HLL Lifecare, Minister of State of Finance Bhagwat Kishanrao Karad said on August 7 in a written response to the Parliament.
The decision to privatise HLL Lifecare, which played a key role in the procurement and distribution of emergency medical supplies during the pandemic, was opposed by workers.
Though the government received multiple bids for the privatisation of HLL Lifecare back in March 2022, the process of strategic sale is still pending. With the request for proposal (RFP) and draft share purchase agreement (SPA) approved by the inter-ministerial group (IMG), the next step is an approval of the Core Group of Secretaries on Disinvestment (CGD) and Alternative Mechanism (AM).
In its response, the central government also said that the bid submitted by the Kerala government as a lead member of a consortium was given due consideration, but since it did not meet the eligibility criteria, the Expression of Interest (EoI) could not qualify.
After the Department of Investment and Public Asset Management (DIPAM) invited preliminary bids for selling 100 percent of the government's stake in HLL Lifecare, back in 2022, the Kerala State Industrial Development Corporation (KSIDC) had also applied to participate in the auction.
"Strategic disinvestment is based on the rationale that wherever competitive industry has come
of age, the economic and job-creating potential of the public enterprise and the economy is better realised in the hands of private sector through infusion of capital and better management practices, while freeing public resources for social sector and infrastructure," the minister said on the reasons behind the decision in the written response.
On the issue of protecting employees under the divestment process, the minister said the terms and conditions in disinvestment include employee-related provisions and after privatisation the prospects of employees are also expected to improve with the growth in production, productivity and profitability.
HLL, a central public sector enterprise under the Ministry of Health and Family Welfare, is involved in the manufacturing and marketing of a range of contraceptives, women’s healthcare products, hospital supplies as well as other pharmaceutical products.
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