The Union Cabinet chaired by the Prime Minister Narendra Modi on Wednesday approved strategic sale of India’s first pharmaceutical company, Bengal Chemicals and Pharmaceuticals (BCPL). The Cabinet also approved the strategic sale of another public sector pharma company, Hindustan Antibiotics (HAL).
From its factory at Panihati, near Kolkata, BCPL makes anti-malaria tablets Chloroquine and Paracetamol, among a host of other drugs and industrial chemicals.
“The option of strategic sale will be explored for HAL and BCPL,” the government said in a statement.
Koltaka-based Bengal Chemicals was established in 1901 by Acharya Prafulla Chandra Ray and the government nationalised it in 1980. The strategic sale of Bengal Chemicals and Hindustan Antibiotics is the second strategic sale approval after 12 years. In September, the Cabinet had cleared strategic sale of Allahabad-based Bharat Pumps and Compressors.
These will be the first privatisation since sale of Jessop and Co in 2003-04 under the NDA government headed by Prime Minister Atal Bihari Vajpayee.
According to the Cabinet decision, the government will sell surplus land of Bengal Chemicals and Hindustan Antibiotics and other two pharma companies Indian Drugs & Pharmaceuticals Limited and Rajasthan Drugs & Pharmaceuticals. This would be done to meet the outstanding liabilities of the four pharma companies. “In this way, the national assets would be utilized in the best national interest,” the government statement said.
The land sale would be through open competitive bidding to government agencies and the outstanding liabilities will be met from the sale proceeds. Voluntary Retirement Scheme/ Voluntary Separation Scheme will also be implemented in these public sector undertakings.
After meeting the liabilities, steps will be taken to close Indian Drugs & Pharmaceuticals Limited and Rajasthan Drugs & Pharmaceuticals, the government said.