Financial Daily from THE HINDU group of publications
Thursday, Feb 20, 2003
Industry & Economy - Disinvestment
HPCL, BPCL disinvestment Shourie allays fears of private monopoly
NEW DELHI, Feb. 19
THE Union Disinvestment Minister, Mr Arun Shourie, has stated that Parliamentary sanction was not required for disinvesting Government stakes in HPCL and BPCL as these two companies were governed by the Companies Act.
In the case of Coal India Ltd and public sector banks that were taken over under nationalisation Acts, it has been specifically stated that this would remain with the Government.
" If Coal India and PSU banks were to be privatised, the Government would have to come before Parliament for a decision, but certainly not for the two oil PSUs in which the previous Governments had divested 49 per cent and 33 per cent stakes respectively'' Mr Shourie said while replying to a short-duration discussion in the Rajya Sabha on Wednesday.
The Attorney-General had made it clear, in his opinion submitted to the Government, that Parliamentary approval was not required for the sale of these two oil companies which were taken over by the Government in 1974 and 1976 through Acts of Parliament.
Responding to members' demands that the A-G's opinion should be tabled in Parliament, Mr Shourie said that he would consider the request and carry out the directions of the chair.
Scotching fears that the disinvestment of HPCL and BPCL would lead to creation of private monopolies in the oil sector, the Ministere pointed out that about 80 per cent of retail trade in oil would remain with the Government even after privatisation of these two entities.
All necessary provisions would be incorporated in the shareholders' agreement of the two oil PSUs to ensure that national security concerns were taken care of during disinvestment.
The apprehensions that oil supplies to defence establishments would be affected with the sale of HPCL and BPCL do not arise as a large proportion of their supplies was being provided by the IOC, which would remain with the Government, Mr Shourie said.
Winding up his reply, the Disinvestment Minister also indicated that the Government was considering the creation of a separate disinvestment fund to ensure that the proceeds from divestment were used for specific purposes such as infrastructure development and social sectors instead of transferring it to the Consolidated Fund.
Stories in this Section
The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription
Group Sites: The Hindu | Business Line | The Sportstar | Frontline | Home |
Copyright © 2003, The
Hindu Business Line. Republication or redissemination of the contents of
this screen are expressly prohibited without the written consent of
The Hindu Business Line