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Nalco may be next victim

New Delhi, Sept. 9: After disinvestment minister Arun Shourie was hopelessly outnumbered at a round of meetings on the divestment issue which decided to defer several large selloffs, it now seems that his only other big ticket sale —National Aluminium Company Ltd —may also get derailed.

Coal and mines minister Uma Bharti met Shourie last week to press her case against the Nalco sell-off.

Her contention is that Nalco is currently undergoing a Rs 4,350-crore expansion and modernisation programme, which is but half-complete. As of now, about Rs 1,700 crore has been spent and work on several major projects, such as a Rs 2,400-crore smelter, is yet to be completed.

A sale before the process ends will mean lower returns, while a sale after the programme has been successfully concluded would fetch the government higher value for the aluminium maker.

Bharti also pointed out that the Cabinet has already cleared a 30 per cent public offering by Nalco—a 10 per cent initial public offering in the domestic market and 20 per cent offering in the global market through an ADR/GDR issue. The disinvestment ministry cannot upstage a Cabinet decision with a sell-off decision on its own, she added.

Though no decision was taken on the Nalco selloff at last Saturday’s meeting of the Cabinet Committee on Disinvestment, Shourie asserted afterwards that he had a mandate to sell Nalco. But the firebrand Bharti is unlikely to give up tamely. She has got together a presentation on the issue and is likely to take it to senior ministers if Shourie does not play ball.

Shourie is already smarting from attacks by Bharti and other anti-divestment Cabinet colleagues. Petroleum minister Ram Naik, human resources development minister Murli Manohar Joshi and defence minister George Fernandes had, at Saturday’s meet on disinvestment, attacked the very need to go ahead with strategic sales of companies, favouring market offerings instead.

They had also thrown open the very definition of strategic and non-strategic industries, challenging the explanation touted till now by the reformist lobby within the Cabinet and demanded that key sectors like oil, telecom and power be included in the definition of strategic industries which cannot be privatised.

There are other ministers who feel other core sector industries like steel and aluminium too should be included at a later date.

Though Shourie’s supporters at last Saturday’s meeting, external affairs minister Yashwant Sinha and commerce minister Murasoli Maran, favoured continuation of the earlier definition that strategic industries were limited merely to defence and railway transport by citing past Cabinet decisions, they have kept the issue open quoting security considerations which could well derail future sell-off bids.

The complexion of the CCD too has changed from a group of pro-reform ministers to one where more conservative ministers have entered. Deputy Prime Minister L. K. Advani and industry minister Balasaheb Vikhe Patil have joined the group of permanent members, while defence minister George Fernandes has made it clear that he would like to be invited whenever a disinvestment comes up in a sector which he feels has security ramifications.

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