It's all in the papers: sell-off takes a new route

NEW DELHI: All’s not gloomy on the disinvestment front. Sale of government holding in PSUs will continue, though the strategies for divestment of shares may see a rejig.
The UPA government has decided to review the existing disinvestment policy and prepare a fresh paper that will clearly spell out its plans to sell shares in public sector companies. Officials said that the department of disinvestment has been asked to prepare a “concept paper� in the next few weeks on the most acceptable route for stake sale in select PSUs. More importantly, the government may present the Budget this time without building in the target for disinvestment receipts. If not, the target may be scaled down substantially.
“We do not want to live with the pressure of meeting any humongous targets,� a source said, indicating that the government may refrain from setting a target unless the concept paper is approved by the government before the Budget.
The Interim Budget presented by the NDA government had fixed the disinvestment receipts target at Rs 16,000 crore on the assumption that the alliance, on retaining office after the elections, will give the divestment drive a renewed push.
The proceeds from disinvestment — sale of shares in ONGC, Gail, Maruti, IPCL, IBP, CMC and Dredging Corporation, as well as sale of additional equity in Hindustan Zinc to strategic partner Sterlite Industries — amounted to Rs 16,048 crore in ’03-04.
The UPA government, as spelt out in President APJ Abdul Kalam’s address to the joint session of Parliament, does not favour privatisation per se. However, it has no objection to divestment of small holdings in blue chip companies, or for that matter, privatisation of chronically loss-making PSUs.
The concept paper, sources said, will spell out separate strategies for navratnas, profitable PSUs and all others, including ailing ones. There will be no privatisation of control of navratnas, but public offerings are not ruled out. All other privatisation will be considered on a case-to-case basis.