Gujarat PSUs likely to shell out funds to promote innovation

AHMEDABAD: Profit making Gujarat PSUs could be in for a second round of 'fund doling' as part of their Corporate Social Responsibility ( CSR) to promote innovation, state Chief Minister Narendra Modi indicated today.

Saying funds for CSR usually go for development of hospitals, making dams or other purposes, Modi said, "I think some percentage of CSR funds should directly go towards promoting R&D and innovation."

"We will here try and start from the state PSU's like GNFC..etc. on how they can contribute to set up a capital fund to promote innovation," Gujarat Chief Minister Narendra Modi said, while addressing an Innovation Symposium as a part of Vibrant Gujarat summit here.

Highlighting the importance of innovation, Modi said, "An idea can change things dramatically, and scientific way of doing things can bring about a change."

There are over a dozen PSUs off which around six are listed PSU companies of the Gujarat government like GNFC, GMDC, GFSC, GIPCL, GACL, GSPL, on bourses and few of them have been among the top six tax payers from the state.

Earlier, in 2008, the Gujarat PSU's were directed by the state government to shell out 30 per cent of their profit before tax (PBT) as part of their CSR.

The contribution was for Gujarat Socio Economic Development Society, a body formed to utilise the PSU funds towards social development.

Following the proposal, the scrips of state-run PSUs had taken a severe beating on the bourses, and many of them hit low of 52-week then.

The move then had triggered an uproar as shareholders of the listed PSUs had opposed the move, alleging that their profit share was not meant for 'charity'.