New Delhi: The RSS affiliated Swadeshi Jagran Manch has called the Modi government’s strategic disinvestment of public sector enterprises an “imprudent business decision” that goes against India’s national Interest.
Earlier this month, finance Minister Nirmala Sitharaman announced that the Narendra Modi government will undertake strategic stake sales in five state-run enterprises, including Bharat Petroleum Corporation Limited (BPCL), the Container Corporation of India (CONCOR) and the Shipping Corporation of India, along with the transfer of management control in these firms.
But the Swadeshi Jagran Manch (SJM) questioned the strategic disinvestment of BPCL and said “it is certainly not a good business decision”.
In its resolution passed in the national assembly held in Hardiwar, SJM demanded that the NITI Aayog’s report on public sector enterprises should be junked. It said there is a need for a fresh assessment of the value and worth of public sector enterprises to achieve the vision of “doubling the GDP in the next five years and accelerating it further in corresponding years”.
“The strategic disinvestment of Public Sector Enterprises (PSEs) is not only an imprudent business decision, but is also against the national interest,” Ashwani Mahajan of SJM said. “It not only denies the people of India –the real owners of PSEs—the fair value of the assets and capital investments, but it also brings in unfair advantage for those who intend to buy.”
“The government has no business to be in business, but resist the plan to handover the national assets to corporate houses of multinational corporations (MNCs) at throw away prices,” Mahajan added.
‘Disinvestment of Air India, BPCL uncalled for’
In a statement, the SJM said the disinvestment of Air India and oil marketing company BPCL was “uncalled for”.
“There is a need for fair assessment of the PSEs – their potential, strategic need, turnaround probability, market utility—and then the disinvestment strategy is required,” it said. “The strategic disinvestment of the national carrier Air India and oil marketing company BPCL at this hour is uncalled for. Air India requires restructuring and professional management, not disinvestment. These are not emotional positions, but a pure business requirement.”
The statement added that restructuring of Air India’s debts and assets can be a turnaround for the company.
“Close scrutiny of Air India’s financial and other documents reveals that the restructuring of Air India’s debts and assets can not only reduce the liabilities for the company but also spin the national carrier back into profits,” it said. “A major chunk of the losses are because of the servicing of the debt. This debt is taken because of the bad decision making (with malafide intentions)… A developing country like, India needs the national carrier for strategic and market balancing requirements”.
It also alleged that the Niti Ayog report is a handiwork of a ‘few consultants (who continue to work on game plan of vested interests)” and should be kept away.
“The new report should be made with a new set of people, who are not only free from the pre-conceived notions but also open to consider the Indian requirements,” it said.
Disinvestment plan due to ‘certain consultants’
Stating that India should not sell its national assets to MNCs, the SJM said the Modi government’s move was the “result of cahoots of certain consultants, bureaucrats influenced by some business house”.
The resolution passed by SJM said it is time to resist such moves and safeguard the “national assets”.
“The government must look into the allegations of conflict of interests and conspiracy to capture Indian assets,” it said.
It also said that the strategic selling of Shipping Corporation of India (SCI) and Container Corporation of India (CCI) are “not great business decisions”.
SJM maintained that a national debate on the disinvestment in the profitable public sector enterprises, and public sector enterprises is the need of the hour.
“A white paper is needed on the previous disinvestment of HPCL, where ONGC acquired the equity. How has this benefited the operations of HPCL?” It questioned. “The government must explain the benefits BPCL will get after its privatisation. There are cases of ‘conflict of interest’ and formation of clique to capture India’s assets. There is a need to probe the way consultants are been appointed to advise the government and subsequently to assist them to offload the equities.”
It also said that BPCL is a profit-making professionally run organisation, and that disinvestment will bring it no incremental value.
“BPCL is in profits and is already giving the exchequer dividends. And at present the Indian stock markets are performing well,” it said. “On the contrary, the are rumours that the Saudi Aramco is eyeing these assets. This is not only unacceptable but also dangerous. The asset created with the national sentiments and hard work shouldn’t land up in the lap of the foreign oil companies — who see these assets only as a statistic to swell their valuation.”
The SJM also said that “one-time bounty by selling the equity will not be a wise business decision” at a time when the government is reporting that their tax collection is not matching the target. SJM cited the recent Sitharaman’s statement indicating that the government is looking at getting R1 lakh crore by selling their equities in five PSEs.