Date:03/03/2004 URL: http://www.thehindubusinessline.com/2004/03/03/stories/2004030300200800.htm

Back Disinvestment proceeds

This is with reference to "At last, a Disinvestment Proceeds Fund" (Business Line, March 2). The article is a timely reminder to the Ministry of Disinvestments that the capital as well as the gains made on the disinvestments cannot be left to the idiosyncrasies of the parties in power.

As per the World Bank guidelines on disinvestment, labour does not, and need not, lose in privatisation, if governments pay attention to easing the social cost of unemployment through adequate severance pay, unemployment benefits, retraining and job-search assistance.

It is now up to the Centre to ensure that the proceeds of the funds received from disinvestments is not squandered away to finance revenue expenditure.

Instead, a stipulated percentage can be earmarked for capital expenditure and building physical and social infrastructure.

Another percentage can be used for retiring public debt. The remainder can be used for a national renewal fund.

C. Ramesh

Keeramangalam (TN)

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