Govt rules out bailout package for Satyam
The government today ruled out any bailout package for crisis-ridden Satyam Computer, but assured to do everything required to save jobs under the framework of its responsibilities.ListenSatyam sagabusiness Updated: Jan 15, 2009 15:58 IST
The government on Thursday ruled out any bailout package for crisis-ridden Satyam Computer, but assured to do everything required to save jobs under the framework of its responsibilities.
"This is a decision that the new board of Satyam would take. This government is not going to directly or indirectly subsidise wrong doing and fraud in Satyam," Minister of State for Industry Ashwani Kumar told reporters on the sidelines of a Petrotech-2009 conference.
When asked, is government not in favour of bailout package for Satyam as such, Kumar said that the new Satyam board "... Are the ones to decide. The government would try and support within the framework of its responsibilities and do whatever it can to preserve and save jobs and to protect the good name of India in corporate sector".
He said, "The government will try to ensure to the extent possible that the brand equity of the country and Stayam in terms of its intellectual capital is preserved and the jobs are secured to the extent possible".
The minister said, "I do believe that Satyam aberration should not in any way take away from the great success story of India in the IT sector."
Earlier speculation was rife that the government is considering a package of up to Rs 2,000 crore to bail out Satyam Computer. But shortly after the Prime Minister Manmohan Singh's review meeting on Satyam on Tuesday, there was media speculation that government would be considering a financial assistance ranging between Rs 500 crore and Rs 2,000 crore but
However, Commerce Minister Kamal Nath, who attended PM's review meeting, had said that the government was open to consider a financial package for Satyam Computer.
The official sources had also indicated that the government appointed Satyam board had written a letter to the finance ministry raising concerns about the liquidity crunch in the troubled company.
Satyam has 53,000 employees and needs over Rs 500 crore a month to meet the staff cost. Satyam had plunged into a deep crisis following the founder-chairman B Ramalinga Raju's admission that he fudged the company accounts to the tune of Rs 7,800 crore.