The Defence Ministry has given approval for disinvestment of 10% of its stake in the country's only aerospace company Hindustan Aeronautics (HAL) in the next five years.
In a Defence Acquisition Council (DAC) meeting held last week, the ministry gave "in-principle" nod to allow 10% disinvestment in the aerospace PSU which will help in modernising HAL and reducing the burden on the government in this regard, Defence Ministry sources said here.
HAL, with a turnover of over Rs 13,000 crore, is witnessing growth as it is involved in almost all the military aerospace projects worth over several thousand crores of rupees.
HAL is the third of the nine Defence Public Sector Undertakings where disinvestment has been allowed by the ministry. Bharat Earth Movers and Bharat Electronics (BEL) are the other two companies.
After the approval, the ministry will now send a communication to the Finance Ministry about its decision, the sources said.
With Finance Ministry's help to fine-tune the modalities, the Defence Ministry will put up the proposal before the Cabinet Committee on Economic Affairs (CCEA) for final clearance, they said.
