Revival of PSEs not linked to divestment: Panel
A Parliamentary panel has asked Govt to expedite selloff of PSEs or provide them with funds.business Updated: Feb 17, 2004 12:27 IST
A Parliamentary panel has asked the Government to either expedite disinvestment of public sector enterprises (PSEs) or provide them with sufficient funds for capital investment.
The Parliamentary Committee on Industry, in its report tabled in Parliament recently, said the revival of PSEs could not be linked with disinvestment which generally gets put off due to legal and political wrangles.
"Since the PSEs are itself bleeding, keeping them on wait would further mean ciphering off last ounce of blood where disinvestment process would hardly extract substantial proceeds," it said.
Calling for adequate funds for capital investment, the report said if there was resource crunch, the assistance could be in the form of working capital, non-plan loan and government guarantee.
"Sitting over the decision is neither going to resurrect the sick PSEs nor it is going to enhance the sale proceeds of PSEs through disinvestment rather it would increase the liability of the PSEs towards statutory dues and payment of salaries," the committee pointed out.
Taking a critical note of inadequate financial assistance to state-owned firms, the Parliamentary Committee on Industry said "the Department of Heavy Industries must have the objective analysis of the basic financial requirement of PSEs and project the same to the Planning Commission and the Ministry of Finance".
During 2002-03, there was a plan provision of Rs 100 crore, which was reduced to Rs 50 crore, it said adding "only because the Department of Heavy Industries was not able to utilise the funds properly".
Out of Rs 50 crore, the Department of Heavy Industries utilised only Rs 47.95 crore which might be the reason for allocation of Rs 100 crore during 2003-04 against the projection of Rs 214.10 crore, it said.