The central government must review its disinvestment policy and the effort should be to empower the CPSEs, not to sell them away, EAS Sarma , former Secretary to Government of India to the Union wrote to the finance minister.

Sarma writes in his letter that in the immediate pipeline of disinvestment are several highly valuable CPSEs like Visakhapatnam Steel Plant, Shipping Corporation of India (SCI) and BEML. Sarma apprehends that, in case the government chooses to rush into selling those CPSEs, this will be causing an enormous cost to the economy and hurt the national interest. The sale of each one of them would end up in nothing less than a scam.

Sarma had cautioned the central government not to sell away a valuable CPSE like the Central Electronics Ltd. (CEL) and the price at which CEL was proposed to be sold to a non-descript private firm of questionable background would imply underselling the CPSE, suggesting that it was going to be a scam.

Finally, the finance minister revoked the proposal, causing embarrassment to the government and throwing a shadow of doubt on the whole process of disinvestment. The central government learnt about the futility of its indiscriminate disinvestment policy. It involves a mindless transfer of ownership of valuable public assets including talented human resources to not-so-capable private parties at questionably low prices, without any fiscal advantage whatsoever. Disinvestment of central public sector utilities not only introduces uncertainty in the future of their employees but also permanently closes avenues for reservation of employment for SCs/STs/OBCs, thus disempowering them.

The proposal of DIPAM to disinvest Pawan Hans, another CPSE also ended in an embarrassing misstep, confirming the apprehensions expressed by many of us about the rationale of the hurried disinvestment policy proposed by you in the Union Budget of 2021. A CBI investigation into the way CEL and Pawan Hans were about to be privatised, I am sure, will bring many ugly facts to the notice of the public and the Parliament.