New Delhi, July 12: Communication Ministry is veering around to accepting the proposed privatisation of VSNL and MTNL if it is done after the scheduled corporatisation of the Department of Telecom Services from October 1.Privatisation of the two telecom giants has been the bone of contention between the Communication Ministry and the Department of Disinvestment for the last few weeks and a breakthrough appeared imminent following discussions between the officials of the two ministries, sources said.During the meeting the communication ministry outlined corporatisation of DTS as the top priority, they said adding that Prime Minister Atal Bihari Vajpayee had constituted a Group of Ministers, headed by Communication Minister Ram Vilas Paswan, to ensure smooth corporatisation from October 1.A decision on privatisation of the two corporations was deferred during the meeting of the Cabinet Committee on Disinvestment on June 23 on account of inter-ministerial differences, sources said.DoD is also keen to privatise VSNL during the current financial year itself as the lock-in period for the shares offered to its employees under ESOP scheme was coming to end by early next year and this could lead to flooding of market with the stocks of the company, sources said. Meanwhile Disinvestment Minister Arun Jaitley is believed to have suggested to Paswan to explore possibilities of giving stock option to employees in lieu of free phones.The value of stock could be in proportion to the benefit given to employees through free phone facilities, Jaitley is understood to have said.Earlier, DoD had reported to CCD that prices of VSNL and MTNL scrip would come down every year in view of the opening of the telecom sector and government must sell its equity early. Share value of VSNL, where government has 59 per cent stake, has nearly halved to less than Rs 1,200 per share now from Rs 2,392 at the end of last financial year.Likewise scrip value of MTNL, where government has 56 per cent holding, has come down to Rs 210 from over Rs 250 barely three and a half months ago. Meanwhile, Disinvestment Minister Arun Jaitley is believed to have suggested Paswan to explore possibilities of giving stock option to employees in lieu of free phones.The value of stock could be in proportion to the benefit given to employees through free phone facilities, Jaitley is understood to have said.The government is also considering advancing of ending VSNL monopoly in the international communication networking from scheduled 2004 and the consequent entry of private players in this segment could further bring down the stock value of navratna VSNL, sources said.Keeping these factors in view the two ministries are understood to be working out on a mutually acceptable programme for divestment of government equity in VSNL, sources said while indicating that communication PSUs were not the debatable issue at the meeting of Committee of Secretaries here on Saturday last. Earlier, DoD had reported to CCD that prices of VSNL and MTNL scrip would come down every year in view of the opening of the telecom sector and government must sell its equity early.Share value of VSNL, where government has 59 per cent stake, has nearly halved to less than Rs 1,200 per share now from Rs 2,392 at the end of last financial year.Likewise scrip value of MTNL, where government has 56 per cent holding, has come down to Rs 210 from over Rs 250 barely three and a half months ago.
