'Govt unlikely to divest profit-making PSUs soon' | india | Hindustan Times
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'Govt unlikely to divest profit-making PSUs soon'

india Updated: Dec 12, 2006 13:15 IST

Finance Minister P Chidambaram on Tuesday said the government was unlikely to divest its stake in any of the profitable public sector units in the near future.

"Some months ago, Prime Minister (Manmohan Singh) put disinvestment on hold pending more consultations. I do not expect any money to flow into the National Investment Fund (NIF) in the immediate future," he said replying to a question during the Question Hour in the Rajya Sabha.

The government had in November 2005 constituted the NIF into which the proceeds from disinvestment of equity in Central Public Sector Enterprises would be channelised.

"Till date, no funds have accrued to NIF," he said, adding that the government would wait for building consensus on divesting small portions of equity in profit making PSUs.

Of the proceeds accrued to NIF, 75 per cent would be used for select education, health and employment schemes while the remaining 25 per cent would be invested in loss-making PSUs to revive them.

"Since there was no consensus (on divesting profit making PSUs), the prime minister had put the process on hold," he said.

Prior to NIF, all proceeds from disinvestment of PSUs were accrued to the Consolidated Fund of India.

Chidambaram, to a separate question, said the government had received five cases of fraud in Industrial Finance Corporation of India (IFCI).

The case against Usha India Ltd for fraud of Rs 67.75 crore is to come up for hearing in January while the case against Malvika Steel Ltd for defrauding Rs 60 crore has been entrusted to the Serious Frauds Investigation Office (SFIO) for investigation.