1629 hours (Shri P.H. Pandiyan in the Chair)
One is ENRON in the State of Maharashtra, the other is the British Gas Company. Both these international companies which are very very strong and powerful multinationals have expressed their desire to get into this field and to buy up to 25 per cent shares of the Gas Authority of India. What is the reason for it, why it should be permitted, we do not understand because the Government itself admits that the Gas Authority of India is a highly efficient and professional company which has been doing extremely well and is meeting the requirements of the community.
So, everything, as I see at present, the original objectives -- the original strategy behind this Disinvestment policy, as stated eight years or seven years ago by the then Finance Minister -- do not hold good any more. The aims for which this was introduced are now being replaced by the kind of a panicky move by the Government to sell out as quickly as they can so that the public sector companies in these important fields are replaced as soon as possible by private sector companies who are willing to come in and make profits. In fact, the market is being sold out. The market is being sold out and this is a part of the policy of the present Government; this is a part of the re-structuring New Economic Policy which is being followed for the last few years and which we have opposed strenuously and we shall continue to oppose. It is because actually it will mean that ultimately everything would be sold out.
Sir, just now when I was coming to the House I met a friend who told me -- I do not know the source of his information, he told me that he would meet me later on and tell me -- that there is a move afoot on the part of the Government...
SHRI SOMNATH CHATTERJEE (BOLPUR): Banks also.
SHRI INDRAJIT GUPTA : Privatisation of banks, anyhow are on the anvil. Already there are so many private banks and foreign banks functioning in this country. We know, lately there has been a Committee's Report advising that more public sector banks should be privatised. But what my friend was telling me was that there is a move now and there is canvassing going on for allowing foreign private sector to come into the retail trade in this country. Retail trade in this country will also be allowed to be penetrated by foreign capital. I do not know whether this is correct or not.
Sir, I suppose, we have one of the most flourishing private retail businesses in India which are manned, owned and controlled by our own people. There is nothing wrong with them. But if this is a move which is just as a parallel move going on to introduce foreign capital into the printed media in this country -- which is also being strenuously opposed by all media people and non-media people and if the newspapers, the Press, the retail business, the insurance business everything is to be handed over to the foreign capital -- then, I do not know, where will we be left at the end of another couple of years?
Sir, therefore, in the polite name of disinvestment what is taking place is actually selling out of the entire business of this country to the private sector, to the foreign parties who are certainly not coming here out of any intention of charity or love towards us but purely in order to make money and augment their profits. It is a matter of shame that this Government which earlier on, many of stalwarts of this Party, were talking about Swadeshi, I do not know, if they still adhere to that objective of Swadeshi or not. They are, in any case, a party now to all these moves.
Sir, my friend, Shri Ram Naik is sitting here and he, of course, will also throw some light on this question as to why they are so eager to sell out everything in this country to the foreign parties and foreign business interests.
Sir, therefore, I am totally opposed to this whole Disinvestment policy. It is a cloak to hide what is actually the real motive of the Government and what is going on. Therefore, I would urge upon the House to be vigilant, to keep a vigilant eye on the movements of this Government and to resist, with all possible means, these moves to privatise everything in this country and hand the resources of this country over to foreign parties who are eager to get in.
SHRI PRIYA RANJAN DASMUNSI : Mr. Chairman, Sir, this discussion within the scope of Rule 193 initiated by the father of the House Shri Indrajit Gupta relates to a matter of great significance and deserves the attention of the House. The whole nation is curiously watching as to what would be the policy of this Government in regard to disinvestment.
Sir, when I saw on the television that the Government led by Prime Minister Atal Bihari Vajpayee issued a communique from Rashtrapati Bhavan for setting up a separate Department called the Department of Disinvestment headed by our dear Minister Shri Arun Jaitley, I thought that the Prime Minister had either lost confidence in the Finance Minister or the Finance Minister is not found competent by him to deal with this important financial task under his umbrella. Anyway, it is a concern of the Cabinet, and the Prime Minister has the full authority to decide on such matters. However, I felt the first thing that was disinvested was the power of the Finance Minister which had already been disinvested to a safe dispensation headed by Shri Arun Jaitley.
The policy of disinvestment has not yet been spelt out by the Government but the Department has been created. It is a fact that at the time of announcement of the policy of economic liberalisation by the Government headed by Shri P.V. Narasimha Rao, it was felt that budgetary support to the loss-making PSUs should be reduced gradually. So, the budgetary support as a percentage of the total plan outlay of the public sector has declined considerably from 32 per cent in 1990 to 13 per cent in 1995.
There is no dispute over the view that the public sector required greater scrutiny. But when the Disinvestment Commission, constituted during the United Front Government which was supported by us from outside, made it
abundantly clear that the ultimate outcome of the disinvestment should be (a) to further strengthen the management of the public sector and (b) to modernise them and to ensure further upgradation of technology, and to see that the surplus available is spent on social sector, human resource sector, etc.
I apprehend, the Minister may correct me if I am wrong, that the party in power had made a very high-tuned campaign before election saying that the economic scenario of the country was absolutely stable and rosy and that everything was in order. The Finance Minister, Shri Yashwant Sinha, during his interview `Hard Talk' on BBC further stressed on it. I presume the Government is now realising that they made a mess of the entire fiscal front. It was to compensate the Rs.10,000 crore budgetary deficit that it was hurriedly thought to off-load even the shares of the Navaratnas at any price. It was exposed in the case of GAIL.
Shri Ram Naik was saying yesterday on television that he was also considering a 10 per cent further off-load of the shares of Indian Oil Corporation. It is unfortunate that they talk such things on television and not in Parliament.
THE MINISTER OF PETROLEUM AND NATURAL GAS (SHRI RAM NAIK): Since the issue is raised, I will reply to it.
SHRI PRIYA RANJAN DASMUNSI : I am just reminding him of what he said on the television.
Sir, with all its right or wrong recommendations, the Ramakrishna Commission, for which I do not hold any brief, submitted seven reports. One of the reports says:
"The Disinvestment Commission has urged the Government to recommend an audit of investment transactions in public sector undertakings by the Comptroller and Auditor General of India within six months of the completion of the transaction."
The Commission had said in its Fifth Report that:
"In order that the disinvestment is ultimately in the best interest of the public while, at the same time, establishing a proper environment for decision-making, it is essential that audit of each disinvestment by C&AG is conducted thoroughly, expeditiously with the involvement of professionals familiar with the working of the industry and the capital markets."
The Commission had said that the reasons are very clear.
The Commission further said that:
"The people involved in the transaction would be available for examination at a time when their memory will be fresh with regard to the action taken and decision arrived at as soon as the disinvestment..."
Now, in case of GAIL which has been much talked about in this country, what was the urgency to sell it when the market price was low? Sir, I can show through the Report of the Disinvestment Commission that they have purposely advised the ONGC not go come under this list at the moment because they are expecting some better price later on, or when the administered price of the fuel would be finally settled down. Now, since they are advising in one way, the Government is responding to their advice. Whom did the GAIL dispose of their shares? They disposed of their shares to British companies and to Enron, who are the competitor of GAIL, and thereby, they will not only have their market command but also the ultimate command in terms of production-controlling management.
Would the Minister consider recommending for such disinvestment including the GAIL's to refer to the Comptroller and Auditor General for quick audit, and explain the transparency in that matter? This is one of the recommendations.
Sir, now conveniently they are choosing something. The Government had got the mandate in the name of NDA. They have come out. The Government has a Disinvestment Commission now to run and plan the direction. The Commission, rightly or wrongly, has got certain kind of autonomy, if not the statutory provisions laid down, which the Parliament can do later on, that too if the Government comes forward. But there is a Department without explaining or placing them before the Table of the House. What is the new approach of this Government in regard to the Disinvestment policy of the country? They have come out in a piecemeal manner. They are disposing of the GAIL in one manner, planning about the NTPC in another manner, and thinking about the ONGC and IOC in some other manner. In the meantime, they have also created a Department of Disinvestment just to work out an immediate need of meeting the budgetary deficit. One of the objectives or conditions of the Disinvestment Commission, if I have heard correctly about the proceedings of the then UF Government is that `It would not aim to meet the budgetary deficit. It has some other works to do.' I have repeated about it earlier also, and I do not want to repeat the same now. That is why, we want to know about the policy. Will they come out with the policy first? What is their policy in regard to disinvestment?
Sir, the hon. Minister has given a very beautiful nomenclature Navratnas -- these are the nine jewels of our country which prove to be worthy of the nation. Who are they? They are the public sector companies. Who are the management? They are our people. The nine jewels prove to be worthy of the nation, and the Government is only considering them whenever they find, in the disinvestment ratio, without considering the market price, to disinvest their share capital at the earliest.
Instead of approaching the international market, the Bharat Petroleum, the Indian Oil Corporation, and the Hindustan Petroleum, will go to the Middle-East or will go to France to buy equity of Gulf oil companies in the Middle-East to operate here, to augment more money for us. The Government is thinking otherwise. "How quickly, they can off-load some of the shares?' Actually they are not `some of the shares', they are 30 per cent, 40 per cent, 41 per cent or even 42 per cent. They are selling them to those who can ultimately take the command of the oil sector.
Now, Sir, through you, I would like to address a very political question to the hon. Minister. He should not take it as technical. We know about the US design in the Middle-East. Why are they creating trouble for Iraq day in and day out? The ultimate design of the US is to get hold of the oil industry in the Middle-East, maybe, after five years, 10 years or 15 years. India's nine jewels are proving their mastery on their feet, be it the Indian Oil, be it the Hindustan Petroleum, be it the GAIL, be it the Bharat Petroleum, be it the IBP, and finally be it the ONGC. They are planning how to off-load their shares and give them to the British companies or to Enron. Do they want all the Middle-East business to be taken over by the US arrangements? Therefore, this matter is not merely of some technical words.
The disinvestment will strengthen this Unit. Disinvestment will fetch some new resources to the Consolidated Fund of India and thereafter all these things will be planned. These are all nothing. The whole approach of yours is, as I understand from your Government, in the absence of your policy, you are very hurriedly planning to please and satisfy some of your masters, if I may use the word, who are planning to visit India very soon, as quickly as possible so that the overall arrangement in the name of economic revolution policy is settled and settled for ever. I strongly feel, therefore, that before you decide anything, you must take the House into confidence placing before it your disinvestment policy. About which areas are you thinking? There are three types of units in public sector, units which you call nine jewels, and units which are healthier. The study has revealed that with some upgradation and modernisation of technology, they can stand on their own feet and there are units which can go for joint sector. You are not using that. You are saying that strategic partner takes them. The ultimate end of it is total
privatisation and giving it to the banks. Therefore, I feel that Government is not serious in this matter. Therefore, instead of placing a policy paper on this matter, they have created a Department to meet their immediate requirements in the Budget.
In the Bharat Petroleum Corporation, now the Government holding is 66.20 and offloaded 33.80. In the Gas Authority of India, the Government holding is 67.34, and off loaded 32.66. In Hindustan Organics, the Government holding is only 58.61 and offloaded 41.39. In Hindustan Petroleum, Government holding is 51.06 and offloaded 48.94. In Mahanagar Telephone Nigam, the Government holding is 56.20 and offloaded 43.80. In Videsh Sanchar Nigam, 52.96 is the corporate holding and offloaded 47.04; And
I have quoted a few of these from the Navaratnas. What message are you trying to give through this process of disinvestment? Have you been able to achieve even one thing for the last 1 1/2 years? Here is the middle order public sector unit. Have you tacked with joint venture programme, a joint sector, to run the show? No. Not a single one. Have you been able to tie up the technology, if I may say so, of the six public sectors to modernise? No. You are coming out with this policy to destroy all those dreams of Pandit Jawaharlal Nehru in those areas of public sector where commanding height of economy has been proposed. Yes, there are arguments. I know. Rs.200,000 crore have been spent. What is the result? There are losses and losses incurred by a lot of people. I do agree that in a developing nation like India, with social obligation and social compulsions, without considering the professional aptitude of the management, we did employ people. Did we commit a crime by giving employment to the people? You should not take the statement that the public sector units are not running in good health in a casual manner. We have to probe. I still consider that if professional aptitude of the management is further monitored and if we get good market access in appropriate time, SAIL in this country could come out from losses. It could and it can. There are arrears. For instance, Dr. Bolla Bulli Ramaiah is here. He handled the Commerce Ministry. If you do not develop STC and MMTC as professional marketing organisations in Government itself, how can they grow? In a few of them, of course, in some cases we took action where the management was wrong. You are taking it as a business, giving it to somebody else and ask them to shut down the door and go back. Is it not a fact? I also handled that Department for a long time. Therefore, the Government is not serious.
There has been a definite under-pricing of the shares of GAIL. When we sold the GAIL shares, the share price was at an all time low. The urgency was that the British Gas Company and Enron at that time dictated, `You will have to sell the shares today; otherwise, we will not buy them tomorrow' and you had succumbed to that without considering the recommendations of the Commission.
MR. CHAIRMAN : There are five more hon. Members to speak.
SHRI PRIYA RANJAN DASMUNSI : I will take very little time.
The period over which the disinvestment is made is very important. There is no option of strategic sales as proposed by the Commission but the strategic sales shall ultimately lead to the total privatization of those units. What are the checks and balances that the Government is considering in this matter? I know, the Government will come out with its reply that it was the Congress Party which initiated liberalization. Yes, it was the Congress and UF Governments that thought of disinvestment. There, it was clearly laid down that the proceeds of disinvestment shall be utilized to modernize the unit itself; and also to spend for the health and social sectors.
We are, of course, consistent in our approach. But when we proposed all these things as our philosophy, Shri Ram Naik and those in Government now, raised the flag of Swadeshi. So, I now watch with great interest that if before the dawn of the new millennium anyone is to be rewarded for greater inconsistency in their political prophecies, it is your Government and your Party. Your inconsistency has converted the idea of Swadeshi into sattaseen. To keep the power with you, you accept whatever suits you, forgetting your ideology.