The government will press ahead with its stalled privatisation programme and sell stakes in two refiners, Hindustan Petroleum Corp Ltd and Bharat Petroleum Corp Ltd, Divestment Minister Arun Shourie said on Monday.

Shourie told the Lower House of Parliament that the government would soon call for bids for a strategic stake in Hindustan Petroleum and would privatise Bharat Petroleum through an initial public offering.

"The government has taken the decision to divest through sale of shares to the public in BPCL and sell HPCL through strategic sale," Shourie told Parliament.

Shourie did not specify a timeframe for the two stake sale.

India's privatisation drive, which gathered pace in 2002 after the sale of stakes in a petrochemicals company and a telecommunications firm, ground to a halt in September after deep cabinet differences emerged over privatising the refiners.

Shourie also announced that employees would be given a specified percentage of equity in the two public sector oil units at a concessional one-third price.

Aimed at fine tuning the divestment process, Shourie said: "The government would continue to ensure that divestment does not result in alienation of national assets, which, through process of divestment, remain where they are. It will also ensure that divestment does not result in private monopolies."

He said a divestment fund would be set up for 'financing fresh employment opportunities and investment, and for retirement of public debt.'

The finance ministry would also present a paper to the Cabinet Committee on Divestment for setting up an asset management company for sale of residual holding of the government in the companies where government has divested equity to a strategic partner, the minister said.

Shourie said his ministry along with finance ministry would work out guidelines for the divestment of 'natural asset companies.'

Elaborating on the proposed divestment fund, he said it would provide complete visibility to the government's continued commitment to utilisation of divestment proceeds for social and infrastructure sectors.

"The main objective of divestment is to put national resources and assets to optimal use and in particular to unleash the productive potential inherent in our PSUs," Shourie said.

Therefore, the divestment policy was specifically aimed at modernisation and upgradation of PSUs, creation of new assets, employment generation and retiring of public debt, he said.

The fine tuning of the policy was done after detailed deliberations on various views expressed and suggestions made including by members of Parliament, he said.

Immediately after the statement, NDA allies -- Shiv Sena and Samata Party -- demanded that a detailed discussion be held immediately on Divestment policy.

Opposition members returned to the house after the statement and continued to demand a debate saying the decision on such crucial issues should be taken after a discussion in Parliament.

Opposition walks out of Lok Sabha over divestment

Opposition members on Monday staged a walkout from Lok Sabha protesting the 'manner' in which the government was pushing ahead with divestment of profit-making oil PSUs.

As soon as Deputy Speaker P M Sayeed asked Shourie to make a suo motu statement on divestment, members of Left parties, RJD and Congress protested the matter was not included in the list of business and had been taken up through a supplementary list.

"This is not the way that matters of such grave importance is decided and pushed through," Rupchand Pal (CPI-M) said.

Somnath Chatterjee (CPI-M) said there were differences within the ruling NDA and even before important matters are decided upon ‘we come to know about them through newspapers and the House is not taken into confidence.'

"This government itself is fractured (on divestment issue). The matter should be discussed in the House," he said.

Congress, RJD and other Opposition members also rose in support of Chatterjee, while Samata Party and Shiv Sena members including Mohan Rawale and Prabhunath Singh demanded that discussion on divestment should be held.

Asking members to be seated, Sayeed said Speaker Manohar Joshi 'has given permission to Shourie for making a suo motu statement. He has to make the statement. Please allow him to do so.'

However, the Opposition members did not heed to the appeals by Sayeed and walked out in protest.

Meanwhile, UNI reported that notwithstanding the 'unanimous' decision of the government on divestment of Hindustan Petroleum Corporation Ltd and Bharat Petroleum Corporation Ltd, Divestment Minister Arun Shourie informed the Rajya Sabha in a written reply that none of the oil companies are to be divested during the current financial year.

The decision, taken at a meeting held by Prime Minister Atal Bihari Vajpayee on December 6, also entails divestments 'through sale of shares to the public in BPCL,' thus ending months-long controversy over divestment in oil PSUs that virtually stalled the entire sell-off process.

He said this in response to a question of Congress member Motilal Vora asking the names of the oil firms which the government proposed to divest in the fiscal 2002-2003.

Shourie indicated that work on the divestment on National Aluminium Company was on course despite certain difficulties.

"Investor interest may be impaired if the timeline for the divestment process becomes uncertain. Uncertainty in this regard can similarly be detrimental for Nalco," Shourie said, answering a question on whether rollback of the divestment of the aluminium major would hurt the government's image and adversely affect the future prospects of the company.

Shourie agreed that there were suggestions for a mid-course review. The government did not distinguish between profit-making or loss-making public sector units, he said.

India's main share index -- the Sensex -- rose to a five-month high early on Monday, boosted by hopes of a revival in the selloff drive.

Additional inputs: UNI & PTI