Financial Daily from THE HINDU group of publications
Saturday, Sep 21, 2002
Financial Daily from THE HINDU group of publications Saturday, Sep 21, 2002 |
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Industry & Economy
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Disinvestment SCOPE moots alternative route for divestment plan Our Bureau
BANGALORE, Sept. 20 The Standing Conference of Public Enterprises (SCOPE), the apex professional organisation representing public enterprises, has suggested alternative routes to the strategic disinvestment decision pursued by the Government and stressed for a debate to arrive at a consensus among all the stakeholders. Stating that the Government should exercise options such as running the PSUs as professional corporate on the lines of L&T or ICICI or a board-managed autonomous company with widely dispersed equity among the public, the Scope Chairman, Mr D.K. Varma, stressed that the Government should come out with a long-term roadmap of phased disinvestment and privatisation with clarity and consensus among all stakeholders. While maintaining that SCOPE was not against the disinvestment or privatisation programme, the Government should adopt a policy of alternative models such as giving complete autonomy to PSUs doing very well, restructuring those units which have potential to recover and compete with the peers and or closing the chronically sick units, which do not respond to any reasonable resurrection efforts through technological upgradation or financial restructuring. Terming the present `ad hoc' approach to PSU reforms through strategic sale model as an unadvisable step, the SCOPE chairman said the role of PSUs should not be undermined even in the globally competitive environment. He said Central PSUs had considerably improved their performance in spite of economic slowdown and had recorded an impressive performance, registering a substantial increase of 564 per cent in overall net profit from Rs 2,356 crore in 1991-92 to Rs 15,563 crore in 2000-01. This is more than the capital invested by the Government so far by way of both capital and loans. During the last three years, the Central PSUs contributed Rs 1,64,068 crore by way of dividend, interest and taxes, which meant that the exchequer received 35 per cent more than the Central Government's total investment during the last three years.
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