People's Democracy

CITU Alternative To Disinvestment

Tax Super-Profits Of Private Sector

CITU president Dr M K Pandhe, has written the following letter to the union finance minister P Chidambaram on November 14 regarding disinvestment in profit-making public sector companies.

THE CITU welcomes the decision of the government of India not to disinvest the shares of navaratna public sector companies. This decision will create confidence and shall strengthen these enterprises as it has been stipulated in the National Common Minimum Programme.

However, we like to draw your attention to the fact that the CMP also states that profit-making PSUs shall not be privatised.

We are therefore quite disturbed by the announcement of the government of India that profit-making PSUs will be disinvested on the plea of utilising the proceeds for social sector and for revival of sick industries.

We consider that disinvestments, even in small doses, is also privatisation in phases and the trade union movement in India has resolutely opposed disinvestments in public sector undertakings. We do not accept unilateral interpretation of the government of India that disinvestment up to 49 per cent equity is not privatisation. Such unilateral interpretation of CMP is impermissible.

If the government of India desires to raise resources for social sector and revival of sick public sector units, the same can be done by imposing tax on super-profits earned by several private sector companies, including some prominent MNCs. We believe that some tax concessions they are enjoying are unjustified and undeserving. The IT sector is an example.

It is highly unfortunate that the ministry of finance is taking several decisions without consulting trade unions in public sector undertakings. We are disturbed that the government has earmarked several PSUs for disinvestment during the current financial year.

The CITU firmly opposes this move of the government of India. Several PSUs were given the status of Mini-ratna companies and were comparable with the navaratna companies as far as their performances are concerned. This aspect has been totally ignored by the government of India.

I would therefore, request you to reconsider the decision of the government to disinvest profit-making PSUs and take steps to raise resources through recovering the unrealised tax revenue unpaid by the corporate sectors and levy tax on super profit-making private sector.

 (INN)