The Hindu Business Line : Govt interference

The Government’s continued interference in the working of PSUs is worrisome. Be it deferring the price revision of petroleum products or the direction to PSUs to park funds with PSBs without seeking the best offer.

The Government should not enforce decisions which are detrimental to the interests of the minority shareholders.

The boards of these PSUs should be independent and take decisions keeping the interests of all the stakeholders in mind rather than merely implementing the directives of the Government.

The independent directors appointed as per Clause 49 of the Companies Act have an added responsibility of resisting the implementation of such directives, which hurt any of the stakeholders, else the purpose of their appointment is not served fully.

Because of Government interference and ambiguous policies, the oil marketing companies, once blue chips, have reached the stage of bankruptcy and are unable to meet even their working capital requirements.

The Prime Minister has stated that the EMI conversion of outstanding dues of airlines has been done for saving jobs. But the question is: At whose cost?

Why assist those companies which mindlessly expanded, distributed free tickets, and did not monitor expenditure? Then the next question is: Why only the airlines?

SEBI also needs to play a role, drawing a line beyond which even the majority shareholder, in these cases the Government, cannot interfere in the functioning of the PSUs.

Atul Kumar Noida

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