It looks like the Central government still nurses a belief that the economic slowdown is simply a cyclical phenomenon that is deliberately being hyped to suit vested interests. And some people believe that a small stimulus package will be enough for economic redemption.
I wonder how forced mergers of public sector Banks, done to tackle Non-performing Assets; the loud reintroduction of an existing export incentive scheme; funding of window for housing sector can help reverse the current meltdown.
Manmohan Singh’s attribution of the slump in the economy to the Modi Government’s “all-round mismanagement” has logic. When core sectors like manufacturing, agriculture, real-estate construction, auto, and services have taken such a strong hit, while consumption and investment are almost at an all-time low, the economic revival needs more than tokenism. Band-aids simply won’t do. The quick fix measures unveiled by the government do not suffice to undo the damage caused by demonetisation and hastily implemented GST.
Coming to Disinvestment of PSEs, the Power sector was of major interest to me personally and tried to find out more initiatives being taken by the government.
The government has decided to privatise three large PSEs, which included Bharath Petroleum, Shipping Corporation, and Concor, where the Centre holds majority shares, and the management is in the hands of the government officials. The proposal is to sell the majority shares in these corporations, to a “strategic buyer” whereafter the government’s interference will end. And this is a welcome measure as we all know the personal gains of the government officials may not be in sync with the growth of these PSE's.
Along with these PSEs government also proposes to disinvest its majority holdings in NEEPCO and THDCIL, but the proposal is to sell the majority holdings to NTPC, which is owned by the government. Therefore, the shares of NEEPCO and THDCIL will henceforth be with the government indirectly, through NTPC. Only the “CAP” gets changed and in the process, the government will obtain Rs16000 crores from NTPC as payment for these PSEs.
It may appear as if the government has no vested interested in these after disinvestment but that will not be the case. The money flow is controlled by NTPC, but the government can still exert its force or say on these companies as the company (NTPC) which is controlling these divested companies is owned by the government. The main problem of these PSUs will remain unattended because the control of these PSEs by government officials will remain intact. Previously the Ministry Of Power appointed CMDs directly, but now it may direct NTPC to appoint CMDs of these PSEs.
Further, the money obtained from Disinvestment will be used to fund the government in paying salaries and pensions, etc. The government is behaving like a person who sells his inherited property to go on a foreign pleasure trip.
The efforts of the government to hand over the management of Bharath Petroleum, Shipping Corporation, Concor to strategic buyers are welcome but efforts to sell the loss-making NEPCO and THDCIL under the guise of Disinvestment to NTPC is deceptive.
I wonder how forced mergers of public sector Banks, done to tackle Non-performing Assets; the loud reintroduction of an existing export incentive scheme; funding of window for housing sector can help reverse the current meltdown.
Manmohan Singh’s attribution of the slump in the economy to the Modi Government’s “all-round mismanagement” has logic. When core sectors like manufacturing, agriculture, real-estate construction, auto, and services have taken such a strong hit, while consumption and investment are almost at an all-time low, the economic revival needs more than tokenism. Band-aids simply won’t do. The quick fix measures unveiled by the government do not suffice to undo the damage caused by demonetisation and hastily implemented GST.
Coming to Disinvestment of PSEs, the Power sector was of major interest to me personally and tried to find out more initiatives being taken by the government.
The government has decided to privatise three large PSEs, which included Bharath Petroleum, Shipping Corporation, and Concor, where the Centre holds majority shares, and the management is in the hands of the government officials. The proposal is to sell the majority shares in these corporations, to a “strategic buyer” whereafter the government’s interference will end. And this is a welcome measure as we all know the personal gains of the government officials may not be in sync with the growth of these PSE's.
Along with these PSEs government also proposes to disinvest its majority holdings in NEEPCO and THDCIL, but the proposal is to sell the majority holdings to NTPC, which is owned by the government. Therefore, the shares of NEEPCO and THDCIL will henceforth be with the government indirectly, through NTPC. Only the “CAP” gets changed and in the process, the government will obtain Rs16000 crores from NTPC as payment for these PSEs.
It may appear as if the government has no vested interested in these after disinvestment but that will not be the case. The money flow is controlled by NTPC, but the government can still exert its force or say on these companies as the company (NTPC) which is controlling these divested companies is owned by the government. The main problem of these PSUs will remain unattended because the control of these PSEs by government officials will remain intact. Previously the Ministry Of Power appointed CMDs directly, but now it may direct NTPC to appoint CMDs of these PSEs.
Further, the money obtained from Disinvestment will be used to fund the government in paying salaries and pensions, etc. The government is behaving like a person who sells his inherited property to go on a foreign pleasure trip.
The efforts of the government to hand over the management of Bharath Petroleum, Shipping Corporation, Concor to strategic buyers are welcome but efforts to sell the loss-making NEPCO and THDCIL under the guise of Disinvestment to NTPC is deceptive.
