Govt sets up panel to oversee Maruti sale

It holds over 50 per cent of the market, compared with more than 70 per cent about two years ago. Maruti, started in the early 1980s, has seen its dominance slip over the past three years with the entry of several international car makers.

Shourie said the panel had also approved the sale of Indian Petrochemicals Ltd’s Baroda plant to Indian Oil at a negotiated price. "The Baroda plant which is built next to IOC’s refinery and is being fed from IOC’s refinery is being sold to IOC at a price which will be determined by the concerned ministries," he said.

"The process of disinvestment at the other two plants at Gandhar and Nagothane will recommence. The bids will be invited all over again."

The Minister said India had also approved the sale of 74 per cent of the government’s equity in fertiliser firm Paradeep Phosphates to a strategic buyer. "The government has decided to disinvest 74 per cent of the shareholding of the government of India in fertiliser company Paradeep Phosphates Ltd through strategic sale to a strategic buyer," Shourie said.

He said the decision would be implemented along with the financial restructuring of the company. India’s privatisation, or disinvestment, programme has been a matter of heated debate in the domestic media, partly because of the government’s inability to push through decisions and meet its targets.

The government has raised just over 40 per cent of its cumulative target of Rs 443 billion since 1991, when India launched free market reforms. Opposition from political groups, including parties in the federal coalition and labour unions, and adverse market conditions have hindered the programme.

India has set a target of raising Rs 10,000 crore through the sale of government equity in state-run firms in 2000/01 (April-March) and has announced a number of decisions recently in a bid to accelerate the process.