 "Arun Jaitley")
Finance Minister Arun Jaitley on Wednesday said the government would look at privatising some of the loss-making public-sector undertakings (PSUs), as supporting those for long with taxpayers' money was not possible.
"Certainly, I am open to looking at some PSUs that could do better in private hands," Jaitley said at the India Economic Summit, organised by the World Economic Forum. "They are being sustained merely on government support. That is not a long-term solution. Taxpayers cannot pay for loss-making businesses."
Certain PSUs were on the verge of closing down and people were going to lose employment, said the finance minister, adding if the choice was between these businesses continuing in their present form, and getting privatised, the second option would be preferable.
Four PSUs were beyond revival, so would have to shut down, Jaitley had told Parliament in July. As many as 79 PSUs were making losses and the public investment in these firms was to the tune of Rs 1.57 lakh crore.
Interacting with Klaus Schwab, founder & executive chairman of the World Economic Forum, Jaitley said the government was following the approach of divestment, and not outright privatisation, for other PSUs.
With regard to foreign investors, the government would follow a sectoral approach. Jaitley was hopeful of Parliament's approval to the Insurance Bill, which seeks to raise foreign investment cap in the sector to 49 per cent, in the winter session.
As some experts have criticised the government for not going for big reforms despite a clear mandate, Jaitley said reforms were not about one sensational idea; implementing reforms was more challenging in a developing society, as public opinion could not be confronted, and doubts had to be cleared.
Commenting on the bottlenecks created by the land acquisition law, Jaitley said he had no quarrel with an increase in compensation but he would focus on easing the procedure. He talked about the need to deal with the provision disallowing private schools, hospitals and hotels on land acquired by the government, as those would make building smart cities difficult.
He also explained in detail India's position on trade facilitation, saying there was no ideological opposition to this issue. Even without a commitment to the World Trade Organizaion, India would unilaterally support moves to facilitate trade. But a solution to the dispute regarding holding of food stocks by India was required, he said, adding that the peace clause should not be phased out till this dispute was settled.
Asked how the new government planned to tackle the systemic failure caused by corruption, the finance minister said the government's actions, such as those on coal ordinance, were aimed at eliminating discretion. Similar reforms were being planned for other minerals as well, he said.
At the end of the session, Jaitley's message to foreign and Indian industry was: "We are waiting for you."
