The present process of disinvestment of public sector enterprises (PSE) is indiscriminate, unplanned and lacks clear policy on the government's part, is the view of the Standing Conference of Public Enterprise (SCOPE).
SCOPE chairman Uddesh Kohli said, "We are yet to see a case where a road map is prepared for proposed disinvestment of the government's share in any of the PSEs. In fact, there is no preparation, whatsoever, before fixing a PSE for disinvestment."
Reiterating the SCOPE's stand in the whole disinvestment process Kohli said, "We are not against the disinvestment process per se but the way it is being dealt with raises many questions."
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Against the general norm where the loss-making PSEs are sold first, the government in India is in a hurry to sell the blue chip companies at a cheaper price, he said.
He agrees to the fact that there is a lot of lobbying from the private sector to have these big ticket companies sold first.
Answering the question why any one would buy stakes in loss-making ventures Kohli said that is where the need for planning and preparing a road map comes in. "The government should first study and strengthen the loss making PSE before putting it up for sale. Funds for strengthening these PSEs can be generated by selling the required share of a blue chip company," he said.
In this regard he suggested setting up of a Restructuring Commission to receive half of the money raised from selling the share of blue chip companies. The same should be spent on realising the old debts, restructuring the potential loss-making PSEs and developing new projects.
He also said PSEs like Bhel, NTPC should not be disinvested from as they are required for benchmarking without which the country will be fleeced by the private operators.
Reacting to the role of the Department of Disinvestment Kohli said it should have more professionals and experts on board than bureaucrats. Asking whether another disinvestment department is required he said it was a good idea provided there was coordination and proper focus on the issues.
He suggested there should be two bodies, one for carrying out the process of disinvestment and other to give expert advise on how to go about it.
He also stressed that to earn real autonomy for these PSEs the concept of administrative ministry should be done away with. "Rather these PSEs should be made accountable directly to the Parliament."
SCOPE will soon submit a paper on disinvestment of PSE to the government. It is also studying the disinvestment processes in other countries to prepare a role model for India.