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This is an archive article published on November 15, 2002

‘Guard divestment against monopoly’

Defence Minister George Fernandes has not submitted his prescription for the disinvestment process yet, but indications are that his recipe ...

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Defence Minister George Fernandes has not submitted his prescription for the disinvestment process yet, but indications are that his recipe on strategic sale of oil firms HPCL and BPCL would be to pre-empt any player from becoming a monopolist in the oil sector.

‘‘His stand, ever since he wrote the letter to the Prime Minister, has been to ensure that no single player could monopolise the market through disinvestment,’’ sources said.

LIMIT MINISTERS: GEORGE

New Delhi: Samata Party president George Fernandes today rejuvenated his 1991 proposal to fixing a limit on the ministerial berths in Parliament or state legislatures. Sources said the proposal — which fixes number of berths to 10 per cent in case of bicameral legislature and 15 per cent in case of single — was aimed at adjustments among parties to promote coalition governments. Fernandes said his proposal was prompted by the political developments in Uttar Pradesh. — ENS

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His party officials also agreed that their main contention was to block any one firm from gaining monopoly over a strategic sector such as oil.

However, Fernandes said his position paper to the PM would incorporate the recommendations of the Disinvestment Commission which had opposed the privatisation of oil firms. ‘‘My views are rooted in the reports of the Disinvestment Commission,’’ he told a press conference. The commission had recommended that the equity holding in oil sector firms be broadbased with some share offering to the public, transfer of some to a national shareholding trust and a majority with the government.

When asked if he was agreed to Kelkar formula which bars any monopolistic attempts, Fernandes said he was examining all such proposals. Vijay Kelkar, Advisor to the Finance Minister, met Fernandes last month and suggested a level-playing oil sector with government-owned IOC, private sector Reliance, public-held BPCL and foreign-owned HPCL as the marketing firms.

Fernandes maintained that he was seeking a mid-term review of the share sale in public sector undertakings so that a course correction, if required, could be undertaken. ‘‘Not that it (disinvestment) is wrong but it should be assessed whether it has been beneficial or a loss, good or bad for the nation,’’ he said.

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He expressed surprise over the Congress move to seek a debate on the disinvestment issue in the lower house. ‘‘Like the Congress, we are also opposed to the sale of profit-making PSUs,’’ he added.

Fernandes said that it was still early for the government to decide as the three-month period was not over. He said that he was not aware of any preliminary meeting between him, Prime Minister Vajpayee and Dy PM L.K. Advani next Tuesday.

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