PSUs free to dilute stake, not control

User charges must: Manmohan.

Prime Minister-designate Manmohan Singh today said public sector undertakings (PSUs) would be free to raise resources through disinvestment or sale of equity as long as they remained public enterprises but the government would not privatise profitable state-owned firms.

"If they (the PSUs) can't compete with the private sector or become a drag on the exchequer, then by all means they will be allowed to raise resources from the market through disinvestment," he said at an unscheduled press conference a day after being appointed prime minister by President APJ Abdul Kalam. "We will not do anything that will make a large pool of workers jobless."

Singh explained the concept of selective disinvestment: PSUs of strategic importance like Gail and Oil and Natural Gas Corporation would remain in the public sector.

"There is no intention of privatising them. Similarly, there are nationalised banks which will remain in the public sector. These will not be privatised," he said.

Singh made an exception on free power for farmers in Andhra Pradesh, saying agriculture in the state was going through a bad patch, but opposed it as a norm.

There were other methods like cross-subsidisation to provide cheaper utilities, but user charges could not be waived in perpetuity, he pointed out.

On schemes like the Golden Quadrilateral highways, which were launched by the Atal Bihari Vajpayee government, he said his government would not scrap them.

"I assure you we are not out to dismantle the schemes of the previous government. We will make an assessment of the schemes. Roads are a national priority. We will strengthen the road network programme, especially the rural connectivity programme to which attention was not given in the past," Singh said.

Displaying a political streak that he has not hitherto shown, Singh played down the contradictions in the Congress' and Left parties' approach to economic issues.

"Our friends in the Left have a different perception of past economic policies, but they are also great patriots and that patriotism and burning desire to make this century the Indian century is something I see common to all Indians," he said in reply to a question on whether he was apprehensive the Left would try to derail economic reforms.

"I am confident that our common minimum programme will provide a basis that unites us. I don't see any problem in working out a programme that is forward looking, progressive and growth oriented."

Emphasising that the mandate for a strong, stable and secular government would keep the Congress' allies and Left parties united, Singh said every one of them was waging a "relentless war" against poverty, ignorance and disease.

Seeking the support of non-resident Indians for economic development, Singh said, "I invite them to show much more interest in the development of the country. The government will create an environment where our industrialists, both NRI and domestic, can create more wealth in the country."

What the Doctor prescribes

Disinvestment

• Restricted to financially weak units
• Profitable PSUs like ONGC and Gail to remain in the public sector
• Nationalised banks not to be privatised
• Interests of workers will be protected

Reforms

• Focus on boosting farm income, employment generation
• Discourage free power to farmers
• User charges cannot be waived in perpetuity
• Enable industrialists, both NRI and domestic, to create more wealth in the country

Roads

• No dismantling of the National Highway Development Project