Stung by the criticism that public sector units are being sold to meet the fiscal deficit, the government on Wednesday announced its plan of setting up a separate divestment fund out of the proceeds of privatisation of the PSUs which will be used for meeting the basic needs of the people.
''The capital receipts should not be used for meeting the current expenditure,'' Divestment Minister Arun Shourie said in his reply to the debate on divestment in the Rajya Sabha.
Shourie said the proposal to set up a divestment fund was the outcome of the three-month review of the divestment programme of the government which had virtually stopped after the September 7 meeting of the Cabinet Committee on Divestment.
The finer print of the plan to utilise the divestment fund would be worked out soon, the minister said, agreeing with many members who said the money raised from the sale of national assets should not simply go to the Consolidated Fund of India.
Answering a point raised by the opposition that there was a wide difference of opinion among the members of the Cabinet on the divestment policy, Shourie said the ‘approach paper' of the Tenth Five-Year Plan, as approved by the Cabinet, has set a target of Rs 78,000 crore (Rs 780 billion) through the selloff programme.
UNI