Poll vault? Oil PSUs to spend more on ‘social’ work
While belts are being tightened across the economy, purse strings are being loosened in public sector oil companies for corporate social responsibility as it is an election year, reports Anupama Airy.business Updated: Feb 02, 2009 22:05 IST
While belts are being tightened across the economy, purse strings are being loosened in public sector oil companies for “corporate social responsibility.” And insiders get a strong whiff of upcoming elections, when this public money could be packaged as political largesse to woo voters.
After substantial fuel price cuts – twice within two months – aimed at pleasing middle class voters, the eyes now seem to be on the rural areas.
Come April, 1, the funds to be made available by the public sector oil companies for undertaking corporate social responsibilities will take a substantial leap from around Rs 250 crore at present to Rs 600 crore.
Even if the profits of oil companies remain where they are, this will translate into a kitty of Rs 500 crore.
This follows a decision taken at a meeting chaired by petroleum minister Murli Deora with the oil company chiefs on Monday. "It has been agreed that the state-owned oil firms would now spend at least two per cent of their net profits of the pervious year on CSR activities," said the chairman and managing director, Indian Oil, Sarthak Behuria.
ONGC's chairman R S Sharma said, "As a result of today's decision, ONGC would now contribute around to Rs 300 to 350 crore towards meeting its CSR commitments."
If implemented the correct way, the decision would go a far way in providing a major boost to India's community development activities, such as provision of facilities relating to education, health and medical care, besides meeting basic needs like providing clean drinking water.
However, a senior oil PSU official said on condition of anonymity said, "Do not over look the timing of this decision. As it (the move) comes close to the general elections being announced anytime now, it remains to be seen whether it will help the society or its caretakers — the politicians."
It has also been agreed that the allocation on CSR activities for the current year will not be less than what was made in the previous year. "On this basis it is expected that more than Rs 600 crore will be made available by Oil PSUs for CSR activities every year," said an official press release.