Petroleum Ministry Proposes Two-Year Extension for IOC Chairman SM Vaidya

27 Jun 2023 , 02:01 PM

The Ministry of Petroleum and Natural Gas has put forth a proposal to grant an additional two-year tenure to SM Vaidya, the current chairman of Indian Oil Corporation (IOC), after his scheduled retirement in August when he turns 60, according to sources familiar with the matter.

The Appointments Committee of the Cabinet will take the final decision on the proposal. On May 16, the Public Enterprises Selection Board, the government’s headhunter, rejected all ten candidates interviewed for the position of IOC chairman and recommended the ministry explore an alternative selection process, sparking speculation about Vaidya’s potential extension.

It is uncommon for a chief of a state-run enterprise to receive an extension beyond the retirement age. However, the appointment of Arun Singh as the chairman of ONGC in December 2022, shortly after retiring as BPCL chief, has influenced the thinking among top executives at state-run enterprises.

The belief now is that age is no longer a barrier, and it is possible to retain the top position or secure another at a different state-owned enterprise after retirement, according to industry executives.

Typically, chiefs of state-run enterprises are appointed for a term of five years or until they reach retirement age, whichever comes first. However, many retire before completing their full five-year term. Younger executives who assume top positions are usually considered for an additional five-year term or a shorter duration that extends until their retirement.

In recent years, the terms of several chiefs of state-run enterprises, including CS Verma of SAIL, Arup Roy Choudhury of NTPC, and B C Tripathi of GAIL, were not extended, resulting in their departure before reaching the age of 60.

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