From disinvestment to reinvestment

The government deserves some black marks for what’s being called the white paper on disinvestment. As hard up as it is, having managed to pick up just about R1,500 crore of its R40,000 crore disinvestment target for the year, it would not be right to ask one public sector unit to pick up a stake in a fellow PSU simply because it has some spare cash. The government is reportedly hoping to mop up some R13,500 crore through such cross-purchases; for instance, a CIL, which is sitting on around R50,000 crore of cash, or an NMDC, which has around R20,000 crore, could be asked to pick up a 5% stake in a SAIL with the government selling some of its shares. In these difficult times when the economy is slowing, cash flows could get squeezed and should be preserved to run the business.

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