No proposal to privatize BHEL – Govt

Government of India today said that its list of public sector companies scheduled to be sold to private entities did not include Bharat Heavy Electricals Ltd.

The company, abbreviated BHEL, has with operations in multiple locations such as Bhopal in Madhya Pradesh and Trichy in Tamil Nadu and is India’s largest suppliers of heavy electrical equipment.

The PSU, already listed on the stock exchanges, is known for its turbines, furnaces, transformers and similar machinery. While functioning a supplier of equipment, BHEL can also play the role of a contractor for putting up an entire power plant as well.

The government’s clarification came in the parliament after two members raised queries about whether BHEL is planned to be privatized or not.

The government under Narendra Modi has promised ‘Maximum Governance, Minimum Government’, and has been getting rid of what it considers unnecessary or superfluous arms, such as government units that make soaps, vehicles and so on.

It has said that it does not want to do things that can be equally well run by private entities.

BHEL was started in 1964 at a time when the Indian private sector lacked the expertise, capacity and experience required to make heavy and complicated electrical equipment needed for large and strategic projects in the country — including dams and thermal power plants. Such equipment, frequently, had to be imported at the time.

However, today, almost everything that BHEL makes is also made by private companies in India.

Nevertheless, said Prakash Javadeka, minister for heavy industries and public sector enterprises, there is no proposal to privatize BHEL at present.

The company has a network of 17 manufacturing units, 2 repair units, 4 regional offices, 8 service centres, 8 overseas offices, 15 regional centres and 7 joint ventures.

Despite competition from the likes of Larsen & Toubro and Siemens, the company is estimated to have a market share of over 50% in the heavy power equipment market in India.

Among its biggest customers are power producers NTPC Ltd and Nuclear Power Corporation of India, both of which are also taxpayer-funded entities.