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Health ministry opposes government plan to privatise HLL

by Bhavya DubeyJuly 31, 2017

The Union Health Ministry has opposed a government plan for disinvestment of HLL i.e, Hindustan Lifecare Limited, one of the largest condom manufacturers in the world and a mini-ratna PSU under the ministry.

The Department of Disinvestment and Public Assets Management, under the Finance Ministry, has circulated a draft Cabinet note on disinvestment of what was once Hindustan Latex Limited.

Due to this, the Health Ministry has cited its multiple partnerships with HLL, including the crucial family planning programme and the recently launched low-cost drug store chain AMRIT, to emphasise that privatising the profit-making PSU will hinder several health programmes.

HLL’s core competence is as a condom manufacturer, but it has diversified into other health-related services, including hospital construction and diagnostic services.

The only company in the world which manufactures and markets such a wide range of contraceptives, HLL produces 1.316 billion condoms annually, making it one of the world’s leading condom manufacturers, accounting for nearly 10 per cent of the global production capacity.

Health ministry’s stand is that no more than 25 per cent of the government’s stake should be sold. They have urged the government to explore other options instead of disinvesting a relatively healthy PSU.

In 2015, HLL opened AMRIT (Affordable Medicines and Reliable Implants for Treatment) pharmacy outlets at AIIMS in the national capital to provide drugs for cancer and heart diseases at affordable prices. There are plans to set up 3,000 such Amrit outlets across India. In 2015-16, HLL’s operational revenues were approximately Rs 1,062.91 crore, and managed an extremely modest profit after tax of Rs 28.88 crore.

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