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Naik supports selloff review

New Delhi, Oct. 14: Petroleum minister Ram Naik has supported the government move of approaching the Supreme Court for a review of its decision on Hindustan Petroleum Corporation Ltd (HPCL) and Bharat Petroleum Corporation Ltd (BPCL) selloff as this was one of the options that had been decided upon by the Cabinet Committee on Disinvesment (CCD).

Naik said the second option of seeking a parliamentary consensus and the third option of discussing the manner of Indian Oil Corporation (IOC) selloff would also be explored.

The government had sought a review of the BPCL and HPCL decision in the Supreme Court yesterday when the issue cropped up during the hearing of a plea filed against the privatisation of Jessop and Co. The apex court had earlier ruled that HPCL or BPCL could not be sold without the approval of Parliament.

Naik said he would take up the IOC issue with disinvestment minister Arun Shourie, but no date had been fixed for the meeting as yet.

Sharp differences have come to the fore between Naik and Shourie over the CCD decision on the divestment of IOC. The petroleum ministry is viewing the divestment as offloading some IOC shares in the market for meeting the government's target so that fiscal deficit can be contained. Shourie, however, is espousing a formula for splitting the lucrative retail business of IOC and selling it to private oil companies.

There has been a strong criticism of Shourie's decision in the oil industry with IOC chairman M. S. Ramachandran stating that the company would collapse if the retail business was split from the refining business. He had said oil companies worldwide were going in for a greater integration of their upstream and downstream operations.

Splitting IOC would be a step in the reverse direction and would prove disastrous for the country's hydrocarbon sector, as the company is the second highest profit earner next only to Oil and Natural Gas Corporation.

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