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Oppn attacks govt on Balco issue

The Opposition in the Rajya Sabha Tuesday mounted a frontal attack on the government over the controversial divestment of the public sector Balco, alleging that "it was an outright sale and scandalous".

Raising a calling attention motion on the issue, senior Congress member Pranab Mukherjee questioned the very purpose of the divestment of the government's 51 per cent equity to private sector Sterlite Industries for Rs 551.5 crore when the aluminum giant was making steady progress and profits.

He said it was regrettable that though Balco was profit-making, the government had decided to divest its shares "simply because the Divestment Commission has recommended".

"We would like to know the rationality of the government and divestment of shares of a profit-making company which has a good track record," Mukherjee said.

Supporting the Congress, Communist Party of India-Marxist member Dipankar Mukherjee said that the divestment process of Balco was 'scandalous' and apprehended that even the sale of Indian Airlines would go the Balco way.

He wondered how the reserve price of Rs 514.40 crore for 51 per cent government equity of Balco could be determined by an executive order. "I feel this (reserve price) has to be decided by Parliament and Parliament alone".

Mukherjee wanted to know whether the objective of the government in divesting public sector units was to bridge the resource gap due to increased consumption expenditure by selling capital assets. If that was the case, divestment was not permissible, he said.

The former finance minister wanted to know if the government was deviating from the 1956 industrial policy to have a mixed economy to distant itself from industrial activity by privatising public sector units.

He asked what the government was proposing to do with the proceeds of the Balco divestment.

Mukherjee said that the government was silent on what it proposed to do with the 270 mw captive power plant in Balco, the cost of which at today's price would be around Rs 1,200 crore.

Dipankar Mukherjee asked what was the hurry for the government to go ahead with the divestment of Balco, saying that the "government should have the courage and admit it was in distress".

"Choosing the valuer is scandalous," he said, adding that the "government must come out clear".

The CPI-M member said the reserve price of the unit should be determined by Parliament.

PTI

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