People's Democracy(Weekly Organ of the Communist Party of India (Marxist)
February 20, 2005
Capitalism : One More “Sweet Heart Deal”
these columns, we had, in the past, pointed out glaring irregularities in the
disinvestment/privatisation of public sector undertakings during the Vajpayee
government. Vajpayee had, in fact, established a separate ministry for
disinvestment whose job, by definition, was to sell prime public assets for a
song to private/foreign capital. In the process, many acts of commission,
omission, sleaze etc surfaced. There were glaring cases like the sale of Centaur
Hotel in Juhu, Mumbai where huge sums of money were pocketed by private parties,
then close to the ruling dispensation.
again a confirmation of this has come, if such a confirmation was ever
high-powered committee, including the finance minister, minister for heavy
industries and the Comptroller and Auditor General (CAG), has cleared a report
prepared by the head of the department of disinvestment within the Ministry of
Finance concerning large-scale irregularities in the sale of CMC Ltd.
This is, once again, like the case of Balco and Centaur, an
instance where the sale was undertaken when there was a single bidder.
This, in itself, raises enormous suspicions on the lack of transparency
and the potential for underhand dealings.
report, however, points out serious infirmities in the figures under various
heads which were crucial for determining the price at which the PSU was to be
sold. For instance, the report states that, “growth assumption of revenue,
which starts at 29 per cent for the year 2002 goes down to 9 per cent by the
year 2007. This is despite a capital expenditure of Rs 150 crore during the same
this is yet another case of a “sweet heart deal”.
The then disinvestment minister, Arun Shourie, already has many a finger
pointing towards such dubious “sweet heart deals”.
UPA government, while ensuring that all malafide acts committed in the past are
corrected and those involved are brought to book, must learn from this
experience and detest from embarking on an unbridled course of disinvestment.
The Common Minimum Programme has assured the country and the people that
this government will not disinvest any profit-making public sector units. This
must be scrupulously
newly-constituted commission for the reconstruction of public sector
undertakings must examine the cases of all unviable public sector undertakings,
according priority for the revival of such units. This is an approach that has
already been outlined in the Common Minimum Programme. This must also be
scrupulously adhered to.