Search the Internet          Tips  Sites: Finance, Investment

BJP for provisions to check fund diversions

BS Political Bureau

Inner bickering within the ruling Bharatiya Janata Party is likely to become murkier as the party has advised the government to make provisions to check diversion of funds from cash-rich public sector enterprises before carrying out divestment in future.

The advice comes in the wake of the assertion of Divestment Minister Arun Shourie that there was nothing wrong in the Videsh Sanchar Nigam Ltd agreement between the government and the Tatas. He had also ruled out the possibility of introduction of new clauses in the agreement to check cash reserves of PSUs from being exploited by new managements.

However ,BJP's economic cell chief Jagdish Shettigar said on Wednesday that the party had not diluted its stance on questioning the rationality of diverting Rs 12 billion from the VSNL's reserve to Tata Teleservices. "In a common man's language, the Tatas have bought the VSNL without spending a penny," Shettigar explained.

Shettigar's outburst against the Tatas just a day after Shourie's press conference made it clear that the party continued to endorse Union Communications Minister Pramod Mahajan's stance on the issue.

"This is a wrong precedent and it could be exploited by some unethical companies," Shettigar said, adding that a mechanism be put in place to curb this tendency.

Though Shettigar explained that the BJP's objection to the Tata's decision must not be seen as a comment on the performance of Shourie or his ministry, the party's apathy towards the divestment minister is expected to trigger a serious infighting even within the government.

Significantly, the decision of the BJP MP from Mumbai, Kirit Somaiya, to approach the department of company affairs in his capacity as the chairman of the Investors' Forum is also seen as an attempt to pressurise the Tatas.

Somaiya, a close associate of Mahajan, has demanded a probe into the Tatas' decision to invest Rs 12 billion in Tata Teleservices alleging that it was tantamount to robbing small investors.

Powered by

ALSO READ:
The Divestment Development
The Rediff Budget Special
The Rediff-Business Standard Special
Money