The ministry of petroleum has opposed the disinvestment of Engineers India Ltd on the ground that it holds designs of key atomic plants.
The divestment ministry has referred the issue to the department of atomic energy and the sale of EIL will now go forward only after it gets a security clearance.
According to a Cabinet Committee on Divestment decision, defence, railways, and atomic energy are considered strategic sectors from the point of view of national security and public sector companies dealing with these sectors will remain under government control.
When contacted, a divestment ministry official confirmed the move but said it would at best result in a slight delay.
"We are confident of getting clearance from the department of atomic energy because world over, designs of atomic power plants are made by private companies. Even the leader in the business, Westinghouse, is a private company," the official said.
Due diligence has already been completed by nearly a dozen prospective bidders for EIL and the government now has to invite the final price bids.
The petroleum ministry had earlier given the go-ahead to the selloff, but the divestment ministry had decided to wait for the clearance to the sale of oil marketing companies Hindustan Petroleum Corporation Ltd and Bharat Petroleum Corporation Ltd since they are key clients of EIL.
"We realised EIL would not get a good price as long as the roadmap for the privatisation of HPCL and BPCL was not clear. But now that the Cabinet has taken a decision on the two marketing companies, EIL could realise its full worth," the official said.
More from rediff