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Journalism of Courage
While dubbing disinvestment as ‘‘good economics’’, Finance Minister P. Chidamabaram today told the Lok Sabha that the government has received letters from workers’ unions and others opposing disinvestment in Bhel, which are under consideration.
‘‘No further decision has been taken in the matter’’, Chidambaram said in reply to a Calling Attention motion raised by CPI leader Gurudas Dasgupta.
He said, ‘‘Minority sale of government shareholding in profitable CPSEs, while retaining majority ownership of the government along with full management control, was within the guidelines of the CMP.’’
Responding to Dasgupta’s demand for increasing tax rates rather than opting for disinvestment, the FM said this year the country was going to mop up 30 per cent higher direct tax collections which was ‘‘responsible taxation’’.
The FM stated that dividend earned from PSEs is return on government investments at par value. But monetised value through disinvestment is many times higher value for the same investment. ‘‘This I submit is good economics, not bad economics,’’ he said.
Gurudas Dasputa had raised the issue in LS on the ground that disinvestment was neither necessary for meeting social sector fund requirement because it was too little and nor would it serve any purpose in carrying the policies of the government forward.
Chidambaram said there were a number of large, profitable, unlisted CPSEs which would gain by getting listed on domestic bourses through IPO of a small proportion of the shareholding of the government. ‘‘There are also a number of listed, profitable CPSEs in which the shareholding of the public is very limited,’’ he said, adding the government has decided to channelise realisation from the disinvestment of a small proportion of its shareholdings into the National Investment Fund.
Chidambaram hints at cutting fiscal deficit
NEW DELHI: The finance ministry on Tuesday expressed confidence of cutting its deficits even though the budget had contemplated no fiscal correction during 2005-06. According to the quarterly review report, tabled in the Parliament, the FM said, ‘‘While concerns arising out of high and volatile level of international crude prices remain, the economy demonstrates considerable resilience and the government’s efforts at fiscal consolidation through improved tax administration and expenditure control are continuing.’’ ENS
Govt to mull proposals on FDI in pension
NEW DELHI: The government on Tuesday said it would carefully consider proposals of a parliamentary standing committee to allow FDI in pension sector on the pattern of the insurance sector. ‘‘I have before me recommendations of the standing committee which say the proportion of FDI that may be allowed in pension fund sector should be the same as in the insurance sector. They will be carefully considered,’’ the FM said. ENS
