The Hindu : Stock market scam in the offing: CPI(M)

Online edition of India's National Newspaper
Friday, Oct 11, 2002

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Stock market scam in the offing: CPI(M)

By Our Special Correspondent

NEW DELHI OCT. 10. With the controversy over disinvestment within the ruling coalition coming out in the open, both the CPI(M) and the CPI have reacted, with the former suspecting yet another stock market scam in the offing.

Referring to the manner in which the disinvestment process in public sector oil majors was halted, the CPI(M) alleged that behind it was the ``sordid tale of loot of nearly Rs.500 crores in the stock markets. The victims as usual, are the small-time middle class investors whose savings have been wiped off''.

The party said that by now, it had become a norm that the shares of companies slated for disinvestment rise closer to the date on which they would be sold. Quoting a report in an English daily, the CPI(M) said the HPCL and the BPCL shares priced at Rs. 187 and Rs. 220 per share, rose to Rs. 300 and Rs. 290 by August end. It said that just before the Cabinet Committee deferred disinvestment in these companies by three months, lakhs of shares were sold when the prices were at their peak. The profit per share ranged between Rs. 50 and Rs. 80.

``Was this entire drama over disinvestment created only to make massive amounts of money? Given this Government's track-record, it is more than possible that behind the high-sounding political rhetoric lay its motivation. To fleece. Truly the Vajpayee Government's `creativity' in creating situations where it can loot the common people's hard-earned savings is amazing,'' the editorial in the latest edition of party organ `People's Democracy' said.

The CPI general secretary, A.B. Bardhan, said in the latest edition of the party organ `New Age', that the fear of elections and mass actions had unnerved some Ministers. ``The fact is some of them who have to face the electorate are seeing how large sections of the basic masses are getting worked up, how discontent is growing and the leading to actions.... Some think a `hardline Hindutva' may seem them through. But not all are sure.''

Mr. Bardhan said the BJP economic cell spokesman felt that the profit-making PSUs should be sold and complain that in the name of accountability, the PSUs had been subjected to much political interference — by the Ministry, the Comptroller and Auditor-General and the Public Accounts Committee. The others areas scrutinised include the method adopted for valuation of PSUs and core sector in PSUs.

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