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Govt clears 33 PSUs for divestment

The Centre had so far cleared 33 public sector undertakings, including BALCO, Hindustan Zinc, Air India and some hotels run by Indian Tourism Development Corporation, for divestment, Union Minister for Divestment Arun Shourie said on Friday.

Echoing Prime Minister A B Vajpayee and Finance Minister Yashwant Sinha's view that divestment would be delinked from the country's financial deficit, he, however, declined to divulge how much the centre expected to mop up by selling its shares.

'It is not a distress sale', he said.

Of the 175 bids received for eight ITDC hotels, 125 had been shortlisted, he said. He, however, admitted that response to Air India's privatisation move was disappointing.

Referring to the demands by the opposition for a 'white paper' on divestment, Shourie pointed out that while the issue had already been discussed five times in parliament. He added that governments of states like Karnataka, Maharashtra and Madhya Pradesh, who sold their shares in state PSUs, were yet to discuss the subject in their respective legislative assemblies.

Referring to the National Textile Corporation (NTC), he said it had so far incurred an accumulated loss of Rs 220 billion and added that out of the 125 textile units, only 25 were making profit.

Similary, only 200 of the 1020 state PSU's were profit making, he said.

Attempting to dispel fears that privatisation of PSUs could lead to job insecurity, he claimed that, on the other hand, joint ventures would not only create more employment opportunities but also add vibrancy and better management.

The centre's projected nine per cent growth rate might not be feasible, he warned. The aim was to double the current per capita growth keeping in view the current population.

'It is not enough to do better than yesterday, but to see what other countries are doing today', he added.

Shourie pointed out that 50 per cent of the Ninth Plan allocation was being consumed by payment of interest on loans or repayment of past debts.

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