IPA Newspack
  • Home
  • now
  • politics
  • business
  • markets

IPA /

IPA Special

IPA Special

House Panel Raps LIC For ONGC Share Buy

NEW DELHI: Life Insurance Corporation’s (LIC’s) purchase of Oil and Natural Gas Corporation (ONGC) shares during the government’s part-divestment of its holding has come under fire from a parliamentary panel.
The Standing Committee on Finance has questioned government-owned LIC’s acquisition and asked the Insurance Regulatory and Development Authority (Irda) to inquire if the company had breached investment norms while buying the shares during the government stake auction.
The report of the panel, headed by former finance minister Yashwant Sinha, was tabled in Parliament on Tuesday.
“The committee cannot but conclude that the objective of disinvestment has been reduced to merely deficit-bridging,” goes its rap on one state-run firm’s equity being bought by the other. The report says it regrets the government using central public sector enterprises (CPSEs) as a “milching cow”.
“It was nothing but mere financial engineering to shift money from one pocket of the exchequer to the other,” is its observation.
The government raised Rs 12,767 crore by auctioning shares in ONGC, and LIC had subscribed to a huge chunk of the issue. The share sale was subscribed 98.3 per cent, with LIC taking 84 per cent of the shares on offer. The rest were bought by institutional and retail investors. Following the share purchase, LIC’s stake in ONGC has gone up to 9.48 per cent.
According to the norm of the insurance sector regulator, insurers cannot hold more than 10 per cent stake in any company. The panel has said that owing to risks associated with the recent acquisition, 290 million policyholders of LIC were likely to be adversely affected.
The government raised about Rs 14,000 crore through disinvestment in public sector undertakings (PSUs) in 2011-12, much less than the budgeted Rs 40,000 crore. For 2012-13, the government targets Rs 30,000 crore through stake sale in PSUs.
“The government should formulate a coherent and effective disinvestment policy without diluting the objectives for which CPSEs have been set up,” the panel said. Adding, the government seems “unduly confident” of achieving the disinvestment target for the current financial year.
The committee has also expressed doubts over the government’s ability to achieve the fiscal deficit target of 5.1 per cent of gross domestic product in 2012-13. “The possibility of occurrence of fiscal slippages again in the year 2012-13 is distinct,” it said, adding the government should prepare a schedule to achieve the budgeted target.
“Doubts over achieving the fiscal deficit target also emerge owing to factors like the government’s huge borrowing programme, widening current account deficit … shortfall in tax collection and failure in achieving the disinvestment target,” the report said.

Happening Now

China seeks urgent meeting after Lanka bows to Indian pressure

August 8, 2022
Politics

Akhilesh to start Tiranga campaign with padayatra

August 8, 2022
Politics

UP minister says he is ready to go to jail for his community

August 8, 2022
Politics

Gehlot’s rape remark kicks up row

August 8, 2022
Happening Now

Speculation over Nitish Kumar walking out of BJP alliance

August 8, 2022
Politics

BJP launches drive to woo minorities in Uttar Pradesh

August 7, 2022
Happening Now

Maiden launch of new ISRO rocket runs into trouble

August 7, 2022
Politics

Parliament ‘dysfunctional’, says Chidambaram

August 7, 2022
Politics

Dhankhar’s victory margin highest since 1997

August 7, 2022
Politics

Opposition parties see a new dawn for Congress in Bihar

August 7, 2022
Politics

Modi says proud moment for India to have ‘kisan putra VP’

August 6, 2022
IPA Special

National Rural Employment Guarantee Scheme Being Sabotaged

August 6, 2022
IPA Special

Supreme Court Finds ‘Shackles Of Policy’ Put By Govt As Intimidating

August 6, 2022
IPA Special

More Tightening Of Monetary Policy May Not Be Effective At The Moment

August 6, 2022
IPA Special

Congress Is Under Seige By The Modi Government And It Will Continue

August 6, 2022
IPA Special

Narendra Modi Is Making All Efforts To Make India ‘Opposition Mukta’

August 6, 2022
IPA Special

Some Semblance Of Normalcy Is Returning To Kashmir At Long Last

August 6, 2022
IPA Special

Drones And Transport Capable Of Reshaping Eurasian Geopolitics

August 6, 2022
Politics

Buzz over Mamata’s meeting with Modi in Delhi

August 6, 2022
Happening Now

Amit Shah says Cong protest has anti-Ram temple message

August 6, 2022

An appeal

The legacy of IPA, founded by Nikhil Chakravartty, the doyen of journalism in India, to keep the flag of independent media flying high, is facing the threat of extinction due to the effect of the Covid pandemic. Only an emergency funding can avert such an eventuality. We appeal to all those who believe in the freedom of expression to contribute to this noble cause.
Click here to learn more

Share

Reply

  • 0
More on IPA

National Rural Employment Guarantee Scheme Being Sabotaged

August 6, 2022 3:53 pm | IPA Staff

  By Gyan Pathak   The Mahatma Gandhi National Rural Employment Guarantee Scheme, popularly known as MGNREGA scheme is systematically being sabotaged. It is being...

IPA Special

Supreme Court Finds ‘Shackles Of Policy’ Put By Govt As Intimidating

August 6, 2022 3:52 pm | IPA Staff

  By K Raveendran   With the Modi government increasingly citing ‘policy’ to justify what it is doing, the Supreme Court has felt compelled to...

IPA Special

More Tightening Of Monetary Policy May Not Be Effective At The Moment

August 6, 2022 3:36 pm | IPA Staff

By Dr. Nilanjan Banik   Over the last two weeks, the Opposition is disrupting the Lok Sabha on the grounds of high LPG price and...

IPA Special

Congress Is Under Seige By The Modi Government And It Will Continue

August 6, 2022 3:19 pm | IPA Staff

By Sushil Kutty   Men and women in black. The women outdoing the men in scaling police barricades. Especially Priyanka Gandhi Vadra. The nationwide protests...

IPA Special

National Rural Employment Guarantee Scheme Being Sabotaged

in IPA Special
Aug 6, 2022   ·  

Supreme Court Finds ‘Shackles Of Policy’ Put By Govt As Intimidating

in IPA Special
Aug 6, 2022   ·  

More Tightening Of Monetary Policy May Not Be Effective At The Moment

in IPA Special
Aug 6, 2022   ·  

Leave a Reply Cancel reply

You must be logged in to post a comment.

Follow us on
Up Next: Oil Ministry Plans To Review CBM Pricing
©2020 -2021 India Press Agency, All Rights Reserved
Newspack by India Press Agency
Posting....
logo
  • Home
  • now
  • politics
  • business
  • markets