Disagreement,dithering,delay top story at state firms

Life Insurance Corporation of India has been without a fulltime chairman for over nine months now

Life Insurance Corporation of India has been without a fulltime chairman for over nine months now. D K Mehrotra,one of the managing directors,has been functioning as current-in-charge chairman of the institution which has an investment corpus of Rs 11 lakh crore. A K Dasgupta,one of the other MDs,retired recently. T Vijayan,who was demoted from chairman to MD,has been on long leave. Against a provision for three MDs and a chairman,LIC currently has two MDs including acting chairman Mehrotra.

The selection process has been marred by charges,counter-charges and vigilance cases involving some of the aspirants to the top post. In a competitive market,the firm needs a strong chairman. But there is a policy paralysis,and the selection process is delayed indefinitely, a high-level institutional source said. LIC is expected to maintain its investment in various assets classes at around Rs 1,95,000 crore in the 2011-12 fiscal.

In December 2011,when General Insurance Corporation of India chairman Yogesh Lohiya retired,Agriculture Insurance Company of India Ltd CMD Ashok Kumar Roy was pulled out and made acting chairman. AIC has been without a fulltime chairman; Milind Anna Kharat is only officiating CMD.

Like LIC,GIC is a strategically important institution. It is the 14th largest reinsurance company in the world,and holds major stakes in several top Indian companies.

UTI Mutual Fund lost its CMD U K Sinha to Sebi in February 2011. For nearly a year since then,the government and US-based T Rowe Price,which holds 26 per cent in UTI,have failed to agree on a new chairman. A four-member team of senior officials took charge,but regulator Sebi disapproved of the arrangement and imposed a ban on new schemes from UTI.

The ban led to UTI losing out on opportunities to mobilise funds; the firm which was numero uno not long ago,was relegated to fifth position behind HDFC MF,Reliance MF,ICICI MF and Birla Sun Life MF in terms of assets under management. Sebi lifted the ban recently after CFO Imtaiyazur Rahman was made acting CEO.

The bone of contention between the government and T Rowe Price was the inclusion of Jitesh Khosla,a 1979-batch IAS officer who is now additional chief secretary of Assam,in the panel of prospective candidates. Khosla,who is the brother of Omita Paul,adviser to Finance Minister Pranab Mukherjee,was not in the shortlist prepared by the Boards human resource committee.