GAIL is just a ‘courier’, says PSU performance panel committee

A government report on gail (India) ltd has described it as a ‘mere courier’ company for gas and has said it should be vested...

A government report on gail(India) ltd has described it as a ‘mere courier’ company for gas and has said it should be vested with a ‘positive charge’ to develop a clear role in the sector.

The comments are part of the feedback report of a high-powered committee, headed by the cabinet secretary, on the performance of central public sector enterprises. The report notes, “the company has no gas of its own but is a mere courier or carrier of it. Government needs to study and vest it with a positive charge lest it limp and sink into a parasite.”

The department of public enterprises has sent the feedback report as an advisory to the petroleum ministry for appropriate action. The feedback on GAIL is clearly the most negative of the seven oil PSUs listed in the report.

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The report points out that because of the attenuated character of the company, the exodus of experienced manpower “is only to be expected. In brief, the company is dressed in borrowed robes after its separation from ONGC. The firm’s growth has been thwarted.” On the company’s financials, the report adds, “The ratio of net profit, (the) net worth of PSE has declined over the years due to enforced low capacity utilisation.”

GAIL’s overseas projects have also come under the scanner. The advisory by the department of public enterprises said, “The company’s joint ventures in China, Egypt, Myanmar, etc., yield scanty returns of about 9 per cent. It should look at better margins. The Iran gas pipeline projects also calls for deep examination.”

However, it also adds that GAIL has scarcely been permitted scope for diversification. In this context it points out, “In-situ gasification in Barmer in Rajasthan with technology tie-up with (a) Canadian company is an opportune initiative.”

Hindustan Petroleum Corp (HPCL) has been lauded for its tie-up with the Mittal group as this may help the company realise global status.

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However, HPCL has been asked to exercise caution on its jatropha cultivation and ethanol blending programmes. The high attrition rate in Oil India Ltd and ONGC have also been listed as issues of concern.

SCATHING SCRUTINY

• ‘Govt needs to vest it with positive charge lest it limp and sink into a parasite’

• ‘Company is dressed in borrowed robes after its

separation from ONGC’

• ‘Joint ventures in China, Egypt, Myanmar yield scanty returns of about 9%’