New Enterprise Policy: The government will probably decide on October 23 whether to wind up MMTC, STC, and PEC

 New Enterprise Policy: The government will probably decide on October 23 whether to wind up MMTC, STC, and PEC

According to The Telegraph, the Indian government is expected to decide on October 23 whether to close the Metals and Minerals Trading Corporation of India (MMTC) as part of its new enterprise strategy for Public Sector Undertakings (PSUs) in non-strategic industries. 

The State Trading Corporation (STC), Project & Equipment Corporation (PEC), and MMTC all lost their status as canalizing agency in September 2022. On October 23, the article stated, a choice about the closure of STC and PEC may also be made.

The Securities and Exchange Board of India (SEBI) terminated MMTC's stockbroker license in August 2023 as a result of paired contracts with the National Spot Exchange Ltd. that were illegally entered into by the company. Without the required regulatory authority, MMTC participated in "paired contracts".

New Business Policy

According to the New Enterprise Policy, if privatization is not possible in the non-strategic sector, all PSUs will either be closed or privatized. According to reports, investors were not interested in the offer for sale that had previously been accepted.

The Alternative Mechanism (AM), made up of Nirmala Sitharaman, the finance minister, Nitin Gadkari, the minister of transportation, and Piyush Goyal, the minister of commerce, will decide the destiny of MMTC, according to the article. The trade ministry has oversight for MMTC.

Currently, the government owns 99.33 percent of MMTC. Prior to this, MMTC worked as a canalizing organization for the export and import of high-grade iron ore, manganese ore, chrome ore, copra, and other priceless metals. MMTC was formerly the biggest non-oil importer in the country.

The state-run trading company declared a profit of 1,076.07 crore for the fiscal year 2022–23, a considerable increase from the loss of 241.93 crore in 2021–22. 

Adminis- trative Power

There are signs that the summit will also cover STC and PEC's future, the article said. The government is the sole owner of PEC even though it owns 90% of STC.

Food staples including edible oils, pulses, sugar, and wheat that are consumed by large numbers of people are imported by STC, whereas import and export of machinery and railroad equipment is facilitated by PEC. 

All three organizations are managed by the trade ministry, and the suggestion to close them is being taken into consideration in accordance with regulations governing the non-strategic sector.