Govt sets up a fund for PSU money

With the new fund, the government has also bought time—from the screaming Left—before its next announcement for disinvestment. ‘‘What’s the hurry, it will be taken up in the next few weeks,’’ Chidambaram said after the meeting of the Cabinet Committee on Economic Affairs.

Chidambaram said the issue of disinvestment in BHEL was also on the agenda ‘‘but could not be taken up as the discussion on formation of the Fund took a lot of time.’’ He said that when in Opposition the Congress and the Left parties had criticised the NDA goverment for using the proceeds from disinvestment of PSUs for current expenditure. ‘‘These are capital receipts and should not be used for revenue expenditure,’’ Chdambaram explained.

The CCEA also gave an in-principle approval for listing of unlisted profitable public sector companies with a net worth of more than Rs 200 crore. It also approved the sale of government’s minority shareholding in profitable PSUs in conjuction with a public issue of fresh equity by the undertaking concerned or independently by the government. ‘‘In both the situations, a condition has been set that in no case should government equity in these companies fall below 51 per cent and management control pass from its hands,’’ Finance Minister P Chidambaram said. Earlier this week, the government had decided to sell 10 per cent equity in BHEL and 7.5 per cent shares in MUL in the next fiscal to raise close to Rs 2,500 cr. In fact, on last Tuesday, Minister for Heavy Industries Santosh Mohan Deb had met the Finance Minister to discuss the modalities of the disinvestment in BHEL and MUL and its timing.