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Govt rules out new divestment panel

Our Bureau

NEW DELHI, March 24

THERE is no need to set up a new disinvestment commission within the next one-two years as the Government will be guided by the recommendations of the previous commission, headed by Mr. G.V. Ramakrishna, while going ahead with its disinvestment programme in select public sector undertakings, Minister in-charge of the Department of Disinvestment, Mr. Arun Jaitley, has said.

According to Mr. Jaitley, disinvestment of Government shareholding in the 54 PSUs, which have been recommended for privatisation, will take around two years, and hence, the necessity of a new commission should arise only after that, as any suggestion mad e by the new set-up may become redundant in the changing economic and market scenario.

Also, the Government is now chalking out a roadmap for every PSU and identifying the end targets on a case-to-case basis.

He was speaking to newspersons on the sidelines of conferences between Indian and US delegations which are in India as part of the US President, Mr. Bill Clinton's South Asia visit.

The Minister made out a case of his Government's disinvestment programme, assuring the gathering that the Government was committed to move out of businesses which were not profit-making and was seeking private participation in corporations which can be r evived.

He also said that the Government was in the process of evolving a new voluntary retirement scheme (VRS), which will provide greater safety net to employees of the PSUs.

Pointing out the example of Modern Foods which was sold to FMCG major Hindustan Lever Ltd (HLL) recently, Mr. Jaitley said that the strategic sale, including transfer of management, would bring in more money to the company as well as to the Government.

The average equity dilution in 39 corporations in which part-disinvestment has been done over the years stands at 12.33 per cent.

``I do not feel that a private investor will put in money into any PSU for the sake of dividend earning. He will look for more, maybe management control,'' the Minister observed.

The Government, according to Mr. Jaitley, is also planning to increase public participation in PSUs by emulating the disinvestment programme effected by Ms. Margaret Thatcher in the UK, whereby the number of public shareholders in the country rose from a round 2 millions to 8 millions after the entire programme.

``The money Government has invested into PSUs is the taxpayers' money. We have to decide how best we can utilise this money. However, there are several other roadblocks apart from the absence of political consensus. But the resistance provided by the sma ller opponents to disinvestment is an experience which helps us do a better job as every input becomes valuable in a learning process,'' the Minister added.