Shourie slams FM on divestment

Joining the war of words on divestment, former minister and BJP leader Arun Shourie on Thursday launched a counter attack on Finance Minister P Chidambaram for his criticism of National Democratic Alliance's sell-off policies, saying the Congress manifesto of 1999 had committed itself to strategic divestment.

Charging Chidambaram with compromising reforms under the pressure of Communist parties, which were "striving" to extend their base in North India, he told PTI that in its manifesto with Sonia Gandhi's picture, the Congress had promised in 1999 that "the recommendations made by the (divestment) Commission on different Public Sector Enterprises, particularly relating to the strategic sales, will be implemented without delays."

Chidambaram had on Wednesday questioned NDA's policy of strategic sale, saying it could never be a preferred route for divestment. "Strategic sale raises more questions than it answers," he had said.

Seeking to counter Chidambaram's argument one-by-one, Shourie recounted a number of decisions taken by Congress governments when either Manmohan Singh or Chidambaram were finance ministers and said even during their tenure there had been a number of cases where single bidders were entertained.

"From Modern Food to Delhi Vidyut Board (under Congress governments) there are many cases of single bidders," he said while reminding Chidambaram of Snam Progetti's single bid for an oil Platform in 1986. "Chidambaram will remember their representative Ottavio Quattrochi as he was very close to the Congress," Shourie said.

Countering the transparency issue raised by Chidambaram, Shourie cited the Supreme Court judgement on BALCO, which had upheld the procedure adopted for its strategic divestment.

He said the apex court ruled that "the system which was evolved was completely transparent. Transparency does not mean the conducting of the government business while sitting on the cross-roads in public...to say that there has been lack of transparency under these circumstances is uncharitable and without any basis.

"They (Congress) were selling shares of Maruti at Rs 269 each at a time when Hindustan Motors, with all its junk shares were touching Rs 700 each and Maruti had 85 per cent of the market share," he said, adding that previous governments had given majority 51 per cent equity to 'pre-selected partner' in a phased manner without even charging Control premium.

He said: "We, on the other hand, got 18 times more value for MUL equity than what (previous governments) got. We also got Rs 1,000 crore (Rs 10 billion) as control premium from Suzuki Motor Corporation even though the previous government had given them majority control."

He also pointed out that price earning ratio in this case was 89 as against 4.9 to 6 the successive governments got during 1991-99 for sale of equity in Navratna PSUs like Indian Oil Corp, Videsh Sanchar Nigam, Gas Authority of India and Hindustan Petroleum Corp.

Questioning Chidambaram's argument that the government got lesser value during strategic sale and objections to single bidder, Shourie said even the Supreme Court upheld the single bid on many occasion and Congress governments in Madhya Pradesh and Delhi have gone for sale of many of their ventures to single bidders.