Disinvestment in line with policy decision: Shourie

By Our Special Correspondent

NEW DELHI, DEC. 1. The Government today asserted in the Lok Sabha that it would not resort to distress sale of its equity in the Maruti Udyog Limited, where it was an equal partner of the Japanese automobile company, Suzuki Motors. Instead, it would go in for international tendering to get competitive prices, the Minister of State for Disinvestment, Mr. Arun Shourie, said.

The Minister denied that the Government's disinvestment move was intended to benefit any individual industrialist and said no dialogue had been opened with anyone. The decision was in line with the disinvestment policy as laid down in this year's budget. The Government was trying to make the process as transparent as possible.

A group of Secretaries had been formed to recommend measures for MUL disinvestment. And after it submitted a report, international tenders for competitive bidding would be issued.

The Minister said Maruti had a strong strategic presence in the Indian market and its losses in the current year would not be allowed to affect its disinvestment process. When asked why a profit-making unit was being divested, Mr. Shourie said production of cars was a low priority. Also, the MUL had not been able to induct new competitive models and its market share had gone down from 83 per cent to 55 per cent in the last three years. The company had made a profit of Rs. 650 crores three years ago but had incurred a loss of Rs. 128 crores during the first seven months of the current fiscal year.

Responding to Mr. Rup Chand Pal of the CPI(M), who said the Government was selling out a public sector company which had revolutionised the domestic automobile sector, the Minister said that MUL was no longer so as the government equity was less than 51 per cent. He told Mr. Mani Shankar Iyer of the Congress and Mr. Ram Mohan Gadde of the Shiv Sena that there were no differences on the issue between the Department of Disinvestment and the Ministry of Heavy Industries as the decision was taken by the Cabinet Committee on Disinvestment.

The Minister described as untenable the allegation that the Government had turned a profit-making unit into a loss- making venture and was trying to get rid of it. About the future of MUL workers, Mr. Shourie said it was premature to discuss it.

Replying to another question, the Minister said no decision had been taken for disinvestment in the Mahanagar Telecom Nigam Limited and the Videsh Sanchar Nigam Limited for reducing government equity to a minority.

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