Ministry of Commerce Approves Winding Up of State Trading Corporation

New Delhi, Jan 10 (KNN) The Ministry of Commerce and Industry has granted approval for the closure of the State Trading Corporation of India Limited (STC), a Public Sector Undertaking (PSU) under its administrative control.

STC played a pivotal role in the country's economy by facilitating the import of essential mass consumption items such as wheat, pulses, sugar, edible oils, and industrial raw materials into India.

Additionally, it made substantial contributions to the development of exports for a diverse range of items from India.

“STC is already approved for closure,” stated a senior government official, as reported by Moneycontrol.

Following the approval from the Commerce Ministry, the closure of STC will be deliberated by the Alternative Mechanism (AM) for a final go-ahead.

The AM comprises Finance Minister Nirmala Sitharaman, Minister of Road Transport and Highways Nitin Gadkari, and the minister from the concerned ministry, which, in the case of STC, is Piyush Goyal.

The AM, rather than the cabinet, has the authority to make decisions on issues concerning the winding up of Public Sector Undertakings (PSUs).

Currently, the government maintains a 90 per cent stake in STC, which also falls significantly below the minimum public shareholding requirement.

According to this norm, a listed company must have a public stake of at least 25 percent.

Shutting down PSUs is a more challenging process compared to disinvestment due to the substantial job losses it entails, stated the official.

Although the government has sanctioned the closure of approximately 21 loss-making PSUs, the actual number of closures completed has been quite limited.

(KNN Bureau)