The Telegraph
Since 1st March, 1999
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Selloff review gathers steam

New Delhi, Oct. 2: Key ministers in the BJP Cabinet today held discussions on a rethink over the disinvestment policy with several of them raising concerns on why profit-making PSUs should be sold even as loss-laden ones draining resources are retained.

Speaking to reporters on the sidelines of a photo exhibition launched here today, petroleum minister Ram Naik said that he, defence minister George Fernandes and human resources minister Murli Manohar Joshi had held informal discussions today on the issue.

“A major concern is whether the government should disinvest profit-generating companies or concentrate on loss-making ones which are a burden,” Naik said.

They also discussed “whether we should go in for an initial public offering or a strategic sale as our chosen mode of divestment. However, at the informal meeting we held today, we did not reach any decisions.”

Naik said amongst the other issues that the trio discussed was the modus of disinvestment in oil companies specifically. “We are still thinking on issues like whom to sell the oil companies, when and how.”

The minister also said in today’s economic and defence scenario, a prime sector like the oil should be viewed in a different light.

Naik went on to say “myself, George Fernandes and M.M Joshi have been depicted in a very negative light. We are certainly not against disinvestment but before disinvesting in the oil companies, we must take into account all our past experiences with disinvestment.”

Naik was referring to statements made by him at an earlier Cabinet meeting, where he had pointed out that during the 1971 war with Pakistan, a multinational oil company had refused to play ball with the government and stockpile oil reserves needed for the crisis.

On being asked how safe it is to disinvest HPCL and BPCL at a time when the stock prices have crashed tremendously, Naik said: “The oil sector is too important to be linked with the crumbling of stock markets where some speculators have managed to loose or make money. I think the two of them should not be associated.”

Sources said immediately after the half-an-hour meeting, Joshi left his residence for a discussion with RSS chief K. S. Sudarshan.

Shourie told reporters separately that he was confident the Prime Minister and deputy Prime Minister felt satisfied with the arguments he had given in favour of disinvestment.

“Everything depends on the Prime Minister and deputy PM. I am confident that they feel satisfied as far as arguments are concerned,” Shourie said soon after the meeting of the three hard-liners in the Cabinet.

The disinvestment minister, however, refused to comment on the meeting of the three ministers. The trio have already torpedoed disinvestment minister’s plan to sell off the two oil marketers by raising security concerns and demanding a wider debate on the entire philosophy behind disinvestment at a Cabinet meeting held on September 7.

“Everything depends on the Prime Minister and deputy PM. I am confident that they be satisfied with the arguments,” Shourie told reporters shortly after the meeting. The three are believed to have pressed for inclusion of petroleum PSUs in the strategic sector to fend off privatisation. The disinvestment ministry, he said, has sent its reply on letters written by Fernandes and public enterprises minister on concerns about the selloff.

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