PM for 'vigorous' PSU disinvestment

To raise resources for development & to make PSU more efficient.

After being put on the backburner for a year, public sector disinvestment can soon be pursued vigorously by the Centre.

"We must once again pursue disinvestment in public enterprises both to raise resources for development and to make public enterprises more accountable and efficient," Prime Minister Manmohan Singh said at a meeting of the Congress Working Committee in New Delhi today.

When it had come to power a year ago, the United Progressive Alliance had said it would not go in for rapid divestment of profit-making public sector units.

The Left parties in the alliance had vehemently opposed divestment of any form. In fact, Singh had downsized the ministry of disinvestment shortly after taking over in May last year.

Speaking to CWC members, Singh said reform of the government and the public sector needed to be further carried out.

"We must pursue with greater vigour and conviction reform of the government, of public enterprises, of our political system and of the judiciary," he said.

He also hit out at ministers and bureaucrats seeking favours from public sector units. In his address, he said ministers and officials should not view these undertakings as their "personal fiefdoms".

Singh said political consensus was required both within his party and across political parties to take the fiscal reforms agenda forward.

Instead of doing any strategic disinvestment, the UPA government offloaded shares in public offers made by public sector units like Punjab National Bank and the National Thermal Power Corporation.

As a result, the government's revenue from disinvestment fell to around Rs 2,600 crore in 2004-05, down from over Rs 10,000 crore in the previous year.

The UPA's predecessor, the Atal Behari Vajpayee-led National Democratic Alliance, had followed an aggressive divestment policy.

Arun Shourie, the then minister for disinvestment, had even mentioned that the Centre could raise as much as Rs 100,000 crore annually from the exercise.