New Delhi, Dec 24: The Finance Ministry favours strengthening of the Department of Disinvestment (DoD) by handing over all public sector undertakings (PSUs) targeted for privatisation to the DoD.In a paper prepared by the Finance Ministry, it has emphasised the need for expediting the divestment process. This, the ministry feels, could be done if the targeted PSUs are handed over to the DoD and the department is made responsible for all decision-making and managerial functions.Ironically, the Finance Ministry's proposal is not likely to find favour with the DoD. At a recent seminar, disinvestment minister Arun Shourie did not show much enthusiasm for more giving powers to the DoD. His predecessor, Arun Jaitley, too, was also against running the PSUs targeted for privatisation.It may be recalled that a separate department with all powers was recommended last year by the Planning Commission member Montek Singh Ahluwalia.Ahluwalia was of the opinion that the administrative ministries are often opposed to divestment in the PSUs which are under their control. His argument was that if the department or ministry responsible for divestment takes over the reins of such PSUs, the sell-off process would become smooth.Shourie and DoD secretary Pradip Baijal were not available for comments on the Finance Ministry proposal.The paper has also strongly recommended privatisation of two or three big public sector banks in order to give a major boost to economic reforms. It has favoured privatisation of weak public sector banks. Bank privatisation has been suggested for the reasons of efficiency and competitiveness.The paper favours unbundling of the state electricity boards which have been draining the public exchequer for years. Another suggestion pertains to the privatisation of power distribution.The finance ministry has strongly recommended privatisation of ports, airports, exressways and coal mining. While not recommending privatisation of Indian Railways, the finance ministry has favoured the entry of private companies in the rail sector.It may be noted that finance minister Yashwant Sinha has fixed a target of Rs 10,000 crore for divestment this fiscal. So far, nothing has been sold, and the chances of achieving the target are bleak. Last year, too, the target was same, but the achievement was around Rs 2,600 crore.
