New Delhi, Feb. 19: The government today announced that it was not interested in privatising oil majors like Oil and Natural Gas Corporation, Gas Authority of India Ltd and Oil India Ltd.
“The government has decided not to privatise IOC, ONGC and GAIL, which will remain as public sector undertakings,” disinvestment minister Arun Shourie told the Rajya Sabha in reply to a short-duration discussion on the disinvestment of oil marketers — Hindustan Petroleum Corporation Ltd and Bharat Petroleum Corporation Ltd.
The statement prompted Manmohan Singh, leader of the Opposition in the Upper House, to say that the government’s decision not to privatise other oil majors only lent credence to suspicions that disinvestment of BPCL and HPCL would lead to “crony capitalism” as unscrupulous politicians and businesses would browbeat the management.
Shourie said provisions were being incorporated in the share sale deeds of the two PSUs being sold to ensure that security concerns like control of oil stocks and supply to armed forces in times of crisis could be ensured.
The minister added that the residual stake with the government after the selloff in HPCL and BPCL would be vested with an asset management company so that there was no interference in the day-to-day functioning of these companies.
He also indicated that a disinvestment fund would be set up as part of the next budget where proceeds from the selloff would be parked in keeping with a Cabinet decision on the issue. The funds will be used to retire government debt and funnel cash into social sector projects.
The disinvestment minister made these conciliatory gestures after BJP allies — the Shiv Sena and the Samata Party — made common cause with the Opposition in both the Houses to demand that the attorney-general, who had agreed with the Centre’s view that HPCL and BPCL could be sold without the repeal of the Bills under which the oil retailers were nationalised in the seventies, should be brought before Parliament for a grilling.
Congress deputy leader in Lok Sabha Shivraj Patil said: “We would like to hear the attorney-general on the floor of the House.”
The Sena chipped in, with its MP Chandrakant Khaire saying: “We are directly opposing this move. Why are you selling profitable companies like HPCL and BPCL' We will not accept it.” Raghunath Jha of the Samata also opposed the selloff decision.
Similar pandemonium reined in the Lower House where Sanjay Nirupam of the Sena called for the AG’s appearance before the House to explain his stand.
Shourie, on his part, defended the attorney-general’s decision, stating these two companies were governed by the Companies Act unlike the Coal India and public sector banks that were taken over under coal nationalisation and bank nationalisation Acts, which specifically state that these would remain with the government.
Nod to crude carriers
Shourie has reportedly approved the acquisition of two very large crude carriers (VLCC) by the Shipping Corporation of India.
With the shipping corporation’s privatisation plan in the final stages, both the ministries of disinvestment and finance had earlier opposed the acquisition plan, estimated to cost about Rs 650 crore, official sources said.