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UTI's investment in Cyberspace -- Shiv Sena MP implicates PMO

Our Bureau

NEW DELHI, July 30

THE Prime Minister's Office (PMO) has once again been dragged into a controversy with a ruling Shiv Sena member today alleging in Parliament that the US-64 scheme's investments in Cyberspace Infosys was preceded by ``three phone calls'' made by the then Unit Trust of India (UTI) Chairman, Mr P.S. Subramanyam, to top PMO officials between July 17 and 21 last year.

The MP, Mr Sanjay Nirupam, claimed that one of the calls made by Mr Subramanyam from Mumbai was to a ``senior official'' in the PMO, who has since then been appointed as a Member in the Planning Commission. Besides, two other calls were made, which, too, were traced to the PMO, Mr Nirupam told the Rajya Sabha while participating in the debate on the US-64 imbroglio.

The member further alleged that the Finance Secretary, Mr Ajit Kumar, had also telephoned the UTI Chairman, ``an hour before'' the Union Budget was presented on February 28 this year. Mr Nirupam's statement today comes hardly a couple of days after Mr Su bramanyam's lawyer, Mr Manishinde, suggesting the role of a ``hidden hand'' influencing UTI's investment in the controversial Lucknow-based infotech company.

Earlier this year, the PMO had figured in a separate controversy over concessions granted in an allegedly non-transparent manner to a certain section of the telecom services sector. It had then culminated in the shifting of the then high-profile Secretar y in the Prime Minister's Office, (PMO) Mr N.K. Singh, to the Planning Commission.

Mr Nirupam said that although the Government had been warned about the UTI's role in the stock market scam in March this year, no action had been taken. He demanded that the Government should table in Parliament the entire list of private placement of eq uity and non-convertible debentures involving the UTI during the last three years.

Several Opposition party members who participated in today's debate demanded the resignation of the Finance Minister, Mr Yashwant Sinha, for not ``properly monitoring'' UTI's investment activities. The role of the Board of Trustees, especially those repr esenting financial institutions, banks and the Reserve Bank of India (RBI), also came in for criticism.

Members also expressed fears over the current redemption problems being faced by US-64 extending to UTI's other schemes, especially the Monthly Income Plans (MIPs), several of which have been reporting below-par net asset values (NAV). Most of them sough t a ``complete restructuring'' of the UTI to enable its running on commercial lines and insulating investment decisions from political considerations.