NEW DELHI, June 1: The Union government has decided to breach the psychological barrier of reducing its majority stake in public sector undertakings. The budget has announced that the government will dilute up to a minimum of 26 per cent in public companies.But the Centre will continue to hold a majority holding in strategically placed PSUs.
The budget has also provided for a revenue mopup of Rs 5,000 crore from divestures in PSUs. It has retained the portfolio of companies selected by the previous government for offloading shares. They are IOC, Gail, VSNL and Concor. It is not known yet whether more companies will be roped in for divestment as the year proceeds or if the divestment target is not met.
The budget also announced plans for restructuring one specific PSU, namely Indian Airlines. The capital will be restructured and a phased divestment is planned over a three year period. The equity holding in what in the ailing airline company will be brought down to 49 per cent over the time span.
Anindependent game plan is being framed for hiving off ailing PSUs which are either terminally ill or the government is not keen on reviving them on its own. A restructuring fund is being constituted for this purpose and these PSUs will be advanced funds from the budget to offer as compensation package to the workers.
The proceeds of the disposal, after settling all pending liabilities, will be credited to the Fund which will get recouped to that extent.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
