Chidambaram meets chiefs of public sector enterprises
NEW DELHI: The Government on Tuesday asked Central public sector enterprises (CPSEs) to park at least 60 per cent of their surplus funds amounting to over Rs 1,00,000 crore with public sector banks (PSBs) and desist from calling for competitive bids for making such deposits.
Interacting with newspersons after a meeting that Finance Minister P. Chidambaram had with the CPSE chiefs, mainly to reiterate the Government’s earlier directive in this regard, ONGC Chairman and Managing Director R.S. Sharma said: “Finance Minister P. Chidambaram has asked CPSEs to follow government instructions of parking 60 per cent of their investible surplus with PSBs.”
With over Rs 1,00,000 crore available with the CPSEs as surplus investible funds, the Finance Minister also directed to the state-owned units not to call for competitive bidding by banks for parking such funds, Mr Sharma said.
In January, the Finance Ministry had directed all public sector undertakings (PSUs) to park at least 60 per cent of their surplus funds with the PSBs. The meeting was convened in the wake of complaints by PSBs that CPSEs were not following the Finance Ministry’s January guidelines in this regard.
Apparently, to earn higher income through deposits, CPSEs with surplus funds call for bids from various banks and, in the bargain, the PSBs lose out to the private sector banks which bid aggressively and offer higher interest rates for such funds.
Following the government directive, however, would result in the CPSEs losing out on additional earnings through higher interest rates. Mr. Sharma pointed out that ONGC which has about Rs. 23,000-crore surplus funds would stand to lose about Rs. 300-400 crore annually on rejecting the highest bid by competing banks.
The meeting called by Mr. Chidambaram on the issue of surplus fund deposits was attended, among others, by GAIL Chairman U. D. Choubey, SAIL Chairman S. K. Roongta, BSNL chief Kuldeep Goyal and other top officials of the ministries of petroleum, power and finance.
However, it appeared that most CPSEs were adhering to the Ministry’s guidelines. Speaking on behalf of the oil sector PSUs, Petroleum Secretary R. S. Pandey said: “There is no such issue with petroleum companies as all of them have more than 60 per cent of their surplus funds parked with the PSU banks.”
State-owned gas major GAIL, on the other hand, has nearly Rs. 4,000 crore as investible surplus and the entire amount is parked in PSBs. “While the FM wants us to deposit 60 per cent with the PSU banks... we have 100 per cent funds parked with them,” Mr. Choubey said.
As for steel major SAIL, which has about Rs 15,000 crore as surplus funds, Mr. Roongta said: “We will follow government instructions in this regard”. Similarly, telecom giant BSNL has about Rs. 30,000-35,000 crore. “We have put 75 per cent of our investible surplus with the PSU banks,” Mr. Goyal said.