New Delhi, Sept. 16: The government’s disinvestment programme teetered on a slippery slope today as rumours swirled that disinvestment minister Arun Shourie had submitted his resignation, which sent public sector stocks into a free fall and the sensex tumbling 22 points. The rumour was later denied both by Shourie’s office and BJP president M. Venkaiah Naidu, who said “it is all bogus”.
Although Shourie’s office denied the resignation rumours, sources said the minister had voiced his unhappiness over the turn of events to BJP party managers.
Trouble continued to brew on another front with fertiliser minister Sukhdev Singh Dhindsa firing off a letter to the Prime Minister opposing the selloff of National Fertiliser (NFL) even as labour unions announced plans for a Orissa bandh on Thursday to try and stall the privatisation of aluminium major Nalco.
On Monday, Sterlite and Hindalco of the Aditya Birla group were among half a dozen companies that submitted expression of interest bids for Nalco, in which the government intends to sell a 29.15 per cent stake along with management control. Hawks within the BJP have already come out against the disinvestment policy and stalled sale of BPCL and HPCL.
Dhindsa told reporters on sidelines of a conference on India Chem 2002: “I have written to the PM for deferring privatisation of the fertiliser PSU as it is making huge profits. After finalisation of new fertiliser policy, its profit is likely to cross Rs 400 crore.” The minister said he was against the disinvestment of NFL as it is a profit-making organisation and is strategic for maintaining stability of prices in the farm sector.
The Akali nominee in the Vajpayee Cabinet had joined a cabal of ministers earlier this month to oppose the Shourie-framed divestment policy, asking for security riders to be brought in as well as a clear focus on which companies needed to be sold off and why. Similarly, all labour unions affiliated to non-BJP parties will go on a Orissa bandh on Thursday, opposing the Nalco divestment. Both the ruling Biju Janata Dal and Samata Dal, members of the BJP-led coalition, will be supporting the bandh.
Coal and mines minister Uma Bharti has made her opposition to the sale clear at a meeting with Shourie last week. Her contention is that Nalco is undergoing a Rs 4,350-crore expansion-cum modernisation programme, which is half complete. Till 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 this ends, will mean lower returns, while doing so later would fetch the government higher value for the aluminium maker.
Bharti also said 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. She added the disinvestment ministry cannot upstage a Cabinet decision on this with a selloff move on its own steam.
Shourie is already smarting from attacks by Bharti, Dhindsa and other anti-divestment Cabinet colleagues, petroleum minister Ram Naik, human resources development minister Murli Manohar Joshi and defence minister George Fernandes at Saturday’s parleys on disinvestment, where this ginger group of ministers had 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 by challenging the explanation put forth by the reformist lobby within the Cabinet. They demanded that key sectors like oil, telecom and power be included in the definition of strategic industries, which cannot be privatised. Other ministers want steel and aluminium to be also included.
The complexion of the CCD has also 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 with security ramifications comes up.
Unfortunately for Shourie, none of these ministers are known to be exactly pro-reform, unlike the other permanent members — finance minister Jaswant Singh, commerce minister Murasoli Maran and foreign affairs minister Yashwant Sinha.