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George, Naik, Joshi discuss oil PSU sell-off

In an interesting development, hardliners against the strategic sale of the government's equity in public sector oil companies, Defence Minister George Fernandes, Petroleum Minister Ram Naik and Human Resource Development Minister Murli Manohar Joshi met in New Delhi on Wednesday.

Sources say that the three senior ministers discussed various aspects of the divestment issue and seemed to have agreed against privatisation in the oil PSUs due to the strategic importance of the sector.

Immediately after the half-an-hour meeting, Joshi left his residence for a discussion with Rashtriya Swayamsewak Sangh chief K S Sudarshan, who is believed to have some reservations against strategic sale of equity in oil PSUs, sources said.

While none of the participants were willing to comment on the nature of the discussion, Naik said: "We met for exchange of information over a cup of tea. We are receiving feedback from various quarters, including from economists."

He declined to entertain any query, but said that it would be wrong to presume that "we are against divestment. We are discussing the route that should be taken for divestment."

Meanwhile, sources indicated that the three ministers were of the opinion that oil sector could be included in the strategic sectors list, which now includes Railways and Atomic Energy, due to its inherent economic importance for the country.

In case, the government takes a decision to include oil in the strategic sector, it would continue to have a majority stake in petroleum PSUs, sources said.

During the discussion that went into the decision of the Cabinet Committee on Divestment to put on hold for three months any verdict on sale of government equity in oil PSUs, the three ministers are also believed to have disfavoured any privatisation in profit-making PSUs through the strategic sale route.

They are believed to have felt that the public offer route should be adopted for divestment in profit-making PSUs.

But the government should give first priority to privatisation of loss-making PSUs, even by selling equity to strategic partners before looking at profit-making corporations, the ministers are understood to have suggested.

The three ministers were also apparently buoyed by the support they were getting from various constituents of the National Democratic Alliance government, including Akali Dal, Biju Janata Dal, Shiv Sena and Samata Party and the Sangh Parivar.

Sources said that the BJD had taken up cudgels against the proposed privatisation of National Aluminium Company Ltd and Coal Minister Uma Bharti too had written to the prime minister over the strategic sale in the aluminium maker.

Likewise, Fertiliser Minister S S Dhindsa, Public Enterprises Minister Balasaheb Vikhe-Patil have also made known their views, sources said.

The resistance to Divestment Minister Arun Shourie's efforts to divest the government's holding in Hindustan Petroleum and Bharat Petroleum and other PSUs was rising with each passing day, said sources.

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