People's Democracy

Thwart This Creeping Privatisation

CITU On BHEL Equity Sale

THE Centre of Indian Trade Unions (CITU) denounced the UPA government’s move to dilute the government stake in the profit-making public sector units. In a statement issued on January 12 the CITU state secretariat termed the move as “retrograde”.

According to reports, the government has announced its decision to sell 5 per cent of its share in Bharat Heavy Electricals Ltd, a profitable PSU manufacturing power plant equipments. And that many other PSUs like PGCIL, PFC etc are next in the pipeline.

Already 33 per cent shares of BHEL were sold out by the previous governments in the centre and further offloading of 5 per cent shares would reduce the government’s stake in the company to around 62 per cent. The CITU felt this clearly manifests the dubious design to crawl towards privatization of profitable PSUs, in parts, because of the restriction on outright sell-off imposed by the Common Minimum Programme.

The CITU opined that such creeping privatisation through dilution of stakes in profitable PSUs by the government militates against the spirit of the CMP, which ruled out privatisation of profit making PSUs. The CMP, of course, mentioned about possibility of profit-making PSUs accessing the capital market for resource generation, if required. The trade unions, particularly the CITU, opposed such provision in the CMP.

The CITU statement noted “However, the PSUs shortlisted by the government for fast-track equity dilution do not satisfy even those stipulations in reality. It is not the BHEL that is now accessing share market for raising resources through sale of shares but the finance ministry or for that matter the central government itself is resorting to sale of family silver riding the “piggy back” for bridging budgetary deficit. The union industry ministry had gone on record in November 2004 that BHEL does not require funds warranting sale of shares but ultimately it had to okay the sale of shares. It appears that the finance ministry has drawn up the blue print to sell out shares of the profit making PSUs up to 49 per cent, one by one, for the time being, given the hurdles laid down in the CMP.”

The CITU also denounced the government move to sale of residual government stake in Maruti Udyog Ltd, a highly profitable unit and a source of recurring income to government exchequer. “Such foregoing of recurring flow of dividend for one time cash can in no way be considered as prudent economy-management and the government must refrain from such short-cut measures”, advised the CITU.

The CITU urged the UPA government to refrain from such retrograde exercise of selling of shares of profit-making PSUs and caled upon the working class and the trade union movement to unitedly act to thwart such designs of creeping privatisation of profitable PSUs. (INN)