Press Release

June 26, 2005

The leaders of the Left Parties – Communist Party of India (Marxist), Communist Party of India, Revolutionary Socialist Party and All India Forward Bloc – held a meeting on June 26, 2005.  They discussed the government decision on disinvestment of shares in the navratna companies in the context of the Common Minimum Programme.  They have sent a letter to the Chairperson of the United Progressive Alliance, Mrs. Sonia Gandhi, in this regard.  The letter is being released to the media.

 ____________________________________________________________

To

Mrs. Sonia Gandhi

Chairperson

United Progressive Alliance

Dear Mrs. Gandhi,

When the UPA government was formed, the Left Parties decided to extend
support to it keeping in mind the verdict of the people who had rejected the policies of the previous NDA government. At that time, all of us felt it necessary to set up a Coordination Committee of the UPA and the Left to discuss the implementation of the Common Minimum Programme (CMP) and other policy issues.

In the meetings of the Coordination Committee, which you kindly convened from time to time, the Left Parties raised a number of issues connected with the CMP and other policy decisions being taken by the UPA government which affected the interests of the common people and the country as a whole. Our experience has been that on many issues where the Left had disagreements, the government nevertheless went ahead with its decisions.

What has perturbed us most is the manner in which the government has decided to go ahead with the disinvestment of shares in the BHEL, to be followed by other navaratanas and profitable public sector units. The Finance Minister has set a target of realizing Rs. 10,000 crores in the Union Budget for 2005-06.

The CMP states, "navaratna companies  to be retained in the public sector while they raise resources from the market”. There is no scope for
misunderstanding here. The navaratnas like the BHEL can go to the market for raising capital for their own needs. It is not for the government to sell
their shares and appropriate those proceeds. The proposal for a national
investment fund is merely a mechanism to facilitate the government
appropriating the proceeds of disinvestment.

It is well known that successive rounds of disinvestment will pave the way
for the eventual privatisation of the concerned PSUs. It is not enough to
say "disinvestment" does not mean privatisation. We are surprised by the repeated assertion that the government will retain 51% share in these enterprises which means that it intends to sell off 49% shares.  From 51%
to 49% is just a small step.  It is creeping privatization.

This step taken by the UPA government is the first serious violation of the
CMP. The UPA-Left Coordination Committee, despite discussing the matter, has been unable to ensure adherence to the CMP commitment.

In the  light of this, we find no useful purpose will be served in attending meetings of the Coordination Committee.  Therefore, we have decided to
regretfully suspend our participation in the Coordination Committee.

With best wishes,

Yours sincerely

A. B. Bardhan (CPI)                                        Prakash Karat (CPI-M)

Debabrata Biswas (Forward Bloc)                     Abani Roy (RSP)

Copy to: Dr. Manmohan Singh, Prime Minister, Government of India, New Delhi