Was he not part of the establishment then?

In his piece, ‘Disinvestment, saffron style’ (IE, Jan. 11, 2000), Mani Shankar Aiyar wrote: ‘‘The other good rea...

In his piece, ‘Disinvestment, saffron style’ (IE, Jan. 11, 2000), Mani Shankar Aiyar wrote: ‘‘The other good reason for offloading part of public holdings on to a private or multinational operator would be that the partner would bring to the unit management, marketing or technological capacities that would exponentially improve the performance of the PSU concerned. This is called ‘strategic disinvestment’. Yet, strategic disinvestment is the last thing on Sinha-Jaitley mindset …’’ In his last column, ‘In praise of George’, he writes, ‘‘We also see the government of the people of this great country abjectly cringing, in the name of ‘strategic sales’, before a bunch of managing agents…whose claim to run these enterprises better than public sector professionals needs to be verified’’. There can be no greater hypocrisy than to make a somersault on strategic sales within 32 months!

If there is some genuine anxiety about unscrupulous ‘agents’ coming in, checks and balances can always by built in. Oil PSUs do not have state-of-art technology either in processing or in marketing, especially in purchase of crude oil by forward trading. With the dismantling of the administered pricing mechanism, all refining companies have to learn the intricacies of this very sensitive trade.

Sunil Jain has rightly highlighted in ‘In search of Ms Right’ (Sept. 14) that strategic sales would bring in much more to the exchequer than if the shares are sold to the public. Aiyar has quoted selectively from the reports of the disinvestment commission to suit his argument. In brief, the disinvestment commission had made recommendations on 53 PSUs in its 12 reports. The recommendations suggested strategic sale of 24 PSUs, trade sale of 8, share offer for 5, deferment in 11 and closure and sale of assets of 4. The present policy appears to be broadly in line with the concepts of the disinvestment commission, although it may not be so for individual PSUs.

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Do we need to remind Aiyar of the dubious practices regarding disinvestment carried out in 1991-92? The PAC in its 94th report (tabled in the Lok Sabha on April 28, 1995) has roundly indicted the then practices followed by the government. Was not Aiyar part of the ‘establishment’ then? One of the first steps in PSU reforms was taken to change the composition of the boards of PSUs and dilute the hold of government directors. The industry ministry issued the new composition of the boards in March 1992 and specified that government directors should not be more than one sixth of their strength. This wasn’t implemented. Was Aiyar then not part of the ‘‘establishment’’?

It is easy to pontificate and change one’s stand to suit one’s own ends. And that end is to obfuscate the main issue of disinvestment so that the PSUs continue to look after the constituencies of the politicians.

(The writer retired as the chairman, Oil India Ltd)