Business Daily from THE HINDU group of publications
Monday, Jul 10, 2006
Business Daily from THE HINDU group of publications Monday, Jul 10, 2006 |
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Opinion
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Letters Disinvestment plans
NLC and NALCO's disinvestment plans predictably ran into rough weather. It is, however, the Government's approach that is at fault more than anything else. Both these companies need thousands of crores of rupees to pursue green-field projects that are on the agenda. They need to come out with fresh offer of shares that will have the effect of raising money and also diluting the government's stake in the process. In contrast, any reduction in the government stake by an offer for sale will be counter-productive as it will reduce the resources that these companies can raise through a public offer. The Indian banks are in a similar predicament. The capital raising plans of PSU firms are in a disarray. These have implications for every issue from meeting power sector targets to capital formation to fiscal deficit reduction. India has risen from such challenges in the past and it may not be appropriate to think that all is lost. We are, however, certainly in for anxiety-ridden months ahead. Suresh Krishnamurthy Chennai The Tamil Nadu Government's handling of the NLC disinvestment is disturbing. There are lessons to be learnt from China and West Bengal on the need for reforms. J. J. Bennett Chennai Letters to the editor and contributions can be sent by e-mail to: bleditor@thehindu.co.in
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