Ficci Backs Govt Disinvestment Programme (10-Mar-2010)
Ficci said that the government should push ahead with disinvestment while paying attention to the timing.
This is due to the unenthusiastic response to sale of equity in power PSUs NTPC and REC notwithstanding,
Ficci''s new President Rajan Mittal said that the timing could be erred but the intent is very clear.
This he said when asked about the government''s divestment programme in the face of the equity sale getting a very poor response particularly from retail investors.
He added that it is not fair to say that the government has no wherewithal but timing has always been an issue and can impact either the private or government entity.
When asked whether the government had financial acumen or capability to complete the programme of disinvestment.
Meanwhile, Finance Minister Pranab Mukherjee has set a budgetary target of mopping up Rs 40,000 crore from disinvestment in 2010-11.
Mittal said that they are only divesting 10% and it is not that they are divesting the whole company.
When asked about the appropriateness of government offering the shares of NMDC at a huge discount as part of a sell-off programme to raise a total of Rs 25,000 crore this fiscal.
Earlier, it was said that he growth of the domestic economy will be 6.9 per cent for the current financial year, pegged by the leading economists in a survey conducted by the industry chamber Ficci, as the farm sector is expected to drag down the economy. The figure is much below the government projection of 7.75 per cent this fiscal.
The leading economists have also broadly opined that the exit of the stimulus measures should happen only in sectors which are showing strong growth.
Moreover, the survey predicts that agricultural growth would contract by 1 per cent in this financial year, but the industry would grow by 8.5 per cent while the services by a smart 9 per cent.
Meanwhile, Ficci President Rajan Bharti Mittal stated that the government should carry on with the stimulus package for exports and areas that still need support.
This it should do although the industry should not expect them to continue in perpetuity.
However, he said a partial withdrawal of the stimulus packages in the Budget was the right step.
He also pointed out that areas such as exports and small and medium sectors will require government support for some more time.
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