Cabinet Committee on Economic Affairs approves closure of Bharat Wagon and Engineering Company

Aug 24, 2017 09:34 IST
Cabinet Committee on Economic Affairs approves closure of Bharat Wagon and Engineering Company

The Cabinet Committee on Economic Affairs (CCEA) on 23 August 2017 approved the proposal of Union Ministry of Railways to close the Bharat Wagon and Engineering Company Limited (BWEL).

The BWEL is a Central Public Sector Enterprise (CPSE) under the Union Ministry of Railways.

The BWEL’s 626 employees will be benefitted from the voluntary retirement scheme to be offered at 2007 pay scale. The Union Government will have to provide one time grant off Rupees 151.18 crore towards severance package and for clearing the current liabilities of the company.

Key highlights

In view of the continues poor physical and financial performance of the company for more than 10 years, in spite of financial assistance and other support provided by the Ministry of Railways combined with low probability of its revival in future, the BWEL is being wound up.

The step will stop flow of financial support from public funds for carrying on the operations of sick/loss making BWEL resulting in savings for the Union Government.

The implementation will be done as per the timelines prescribed in the guidelines issued by Department of Public Enterprises (DPE) on time bound closure of sick/loss making CPSEs.

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About Bharat Wagon and Engineering Company Limited

The Bharat Wagon and Engineering Limited is a Public Sector Undertaking of the Government of India.

It is a subsidiary of Bharat Bhari Udyog Nigam (BBUNL).

The BWEL was established on 4 December 1978 after taking over two sick companies: Arthur Butler & Co and Britannia Engineering Company.

The Company was referred to the Board for Industrial and Financial Reconstruction (BIFR) in December 2000 and was declared sick in the year 2002. The Company continues to be a sick Company since then.

The administrative control of the company was transferred from Department of Heavy Industry (DHI) to the MoR in August 2008, as approved by the CCEA.

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