The Central Electronics Limited (CEL), set up by the CSIR, was a public sector enterprise commercialising indigenous technological developments of public entities and publicly funded research organisations. The Government, in November 2021, cleared the sale of 100 per cent of its stake in CEL to Nandal Finance and Leasing Private Limited for Rs. 210 crores. The CEL is a public sector operating in a critical area and its hurried sale immediately led to indignation from the scientists and engineers.

Subsequently, the letter of intent for privatisation was put on hold by the Government, while an inter-ministerial group was examining certain allegations. There is secrecy around the process of sale, The scientists feel that the move is still on and the present government may again try to hand over the strategic PSE to the private party.

A group of thirty-five retired directors and senior scientists of the Council of Scientific and Industrial Research (CSIR) have, in their letter to the Ministry of Finance (MoF) expressed their concern regarding the sale of CEL.

A concern of utmost importance raised by the signatories is that Nandal Finance has no competence and can harm CEL’s technological capabilities. As per the signatories’ analysis of Nandal’s books of accounts, the company has no fixed assets, no land & buildings, computers, laptops, etc., and is a trading company with no significant resources.

The letter submits, “The financial position of M/s Nandal Finance & Leasing Private Limited is not sound. 99.96 per cent of its shares are held by M/s Premier Furniture & Interiors Private Limited formed on Oct 23, 2007. During FY 2019-2020 and FY 2018-2019 its account books show loss. Not even a single employee has completed five years.

“The sale of CEL to a financial intermediary / trading company with no fixed assets, no competence, managerial or technological, cannot be expected to bring technology and best management practices. The company is under winding up proceedings and the case is pending with Hon’ble NCLAT vide Case No. 117/2020. The case is filed by Registrar of Companies seeking winding up of the company. We are afraid that M/s Nandal Finance & Leasing Private Limited will dismantle CEL.”, the scientists said.

The letter further mentioned that the signatories are “concerned about the future of Central Electronics Limited (CEL). CEL is known for the development of products through its own efforts and in close association with the premier National and International Laboratories including Defense Laboratories. In recognition, CEL has been awarded a number of times with prestigious awards including National Award for R&D by the Department of Scientific and Industrial Research (DSIR).

As of October 31, 2021, CEL has pending orders worth Rs 1592 crores. With these orders alone, CEL would give GoI a gross profit of about Rs 730 crores. As of March 31, CEL had a land in possession making for a valuation of Rs 440 Crores as per the circle rate.

Irrespective of whether the land forms a part of the bidding process, the signatories submit that the intrinsic value of CEL’s assets, tangible and intangible, including its brand value built over the course of four decades and the technical capabilities of its highly professional staff, including 130 engineers, cannot be ignored.

With respect to strategic sector enterprise, the signatories submit, “CEL has been instrumental in putting up solar photovoltaic plants in prestigious buildings like Rashtrapati Bhavan and many archaeological monuments. It had developed deep water solar pump sets for agricultural applications and developed flexible solar panels for areas like Siachen and other remote defense locations for communication equipment. CEL has also put-up solar facilities in many African countries like Sudan, Mozambique, Senegal, and Mali and so on.”

While the technological achievements of CEL assume prime importance for putting up large capacity solar generating facilities in the country, the letter also states that it had a number of rapidly-moving initiatives ongoing at present as well as projects underway for indigenisation in railway signaling related areas.

Further, the signatories are “puzzled that when the Department of Electronics is planning to invest Rs 76000 Crores for the establishment of over 20 semiconductor design, components manufacturing and display fabrication units over the period of next six years, why the empowered group of the Cabinet Committee on Economic Affairs is wanting to privatize CEL.”

Earlier Dr. E A S Sarma, former economic affairs secretary of the Government sent a letter to the finance ministry questioning the CEL deal and urged the Government to stop any move to hand it over to the private party. In fact Dr. Sarma has sought complete halt to the present process of public sector disinvestment since there is no transparency and the assets are being undervalued. Both the proposed LIC IPO and the CEL sale proposal indicate how the BJP government is desperate to do away with the prized national assets to the industrialists without caring for the national interests. (IPA Service)