Aeons ago the BJP stood out in the Indian polity for its advocacy of market-friendly ideas. Some eight months in government would suggest the party is more comfortable with risk-averse,baniya-style economics than in being an audacious herald of free enterprise. Take the ruling coalition's attitude towards disinvestment. Various reports of the Disinvestment Commission have been received.The list of companies to be opened up to private funds is in place. Yet, the Government has moved with a disinclination which would befit an East Bloc regime from the '60s. The Container Corporation of India's upcoming equity offer is being portrayed as a triumph. In actuality, it represents only the finance minister's desperation to earn Rs 5,000 crore from disinvestment, as per his budget calculations.India's experience with disinvestment has become the swadeshi version of voodoo economics. For a start, there is the self-defeating exercise of selling PSU equity to public-owned financial institutions. This is no more than jugglery, with share certificates moving from one hand of the Government to the other. Next there is acute reluctance to recognise that the real need is not for piecemeal disinvestment but full-scale privatisation. The case of Air India is indicative. It reported a loss of Rs 106 crore in the first five months of 1998-99. To get it out of the ICU would require fresh equity infusion worth Rs 1,924 crore. There is absolutely no alternative to the sale of Air India to a credible international airline willing to turn it around. Such negotiated sales have other advantages. One, they ensure that the new owners are competent to take charge of the company. Two, they are insulated from the market sentiments which make public offerings such a gamble. Such sales also need a prerequisite: political backbone. Does the BJP have the spinePublished By: AtMigration Published On: Nov 16, 1998--- ENDS ---
