Date:03/07/2009 URL: http://www.thehindu.com/2009/07/03/stories/2009070355821300.htm

Business

Losses of public sector units increase

Special Correspondent

NEW DELHI: Despite the Centre increasing its spending in reviving public sector enterprises (CPSEs), the losses of state-owned units increased in the last fiscal.

Of the 242 units, 53 incurred losses worth Rs. 11,274 crore in 2007-08 against Rs. 8,457 crore in the previous fiscal, said the Economic Survey 2008-09. It was the National Aviation Company of India Ltd. (NACIL), which runs the national carrier Air India that remained poor.

Investments up

“The loss of loss-making CPSEs increased mainly due to loss incurred by NACIL (Rs. 2,226 crore) during 2007-08 as compared to Rs. 688 crore loss incurred by Air India and Indian Airlines together during 2006-07,” the Survey said.

However, a total of 160 CPSEs made profit worth Rs. 91,083 crore last fiscal against Rs. 89,578 crore in 2007-08. CPSE investments also grew by 8.31 per cent in 2007-08 at Rs. 4.55 lakh crore against Rs. 4.20 lakh crore in the previous year.

Most of the investment was from internal generation by these firms which seemed to have taken advantage of the robust economic activity till 2007-08.

“The year also witnessed severe financial under-recoveries by public sector oil marketing companies as they had to keep the prices low in the domestic market on sale of the petroleum products,” the Survey added.