After having a relatively smooth sailing at the full Planning Commission meeting, efforts are on to get Cabinet clearance before the two groups harden their stand. The Plan document aims at a divestment target of Rs 78,000 crore and doubling the flow of foreign direct investment (FDI) in five years.
The full Planning Commission, headed by Prime Minister Atal Bihari Vajpayee, okayed the Plan document on October 5. Finance minister Jaswant Singh and external affairs minister Yashwant Sinha had also attended the meeting as part-time members of the Commission.
Official sources said that the Cabinet approval of the Plan document would mean a commitment of all ministers to divestment process, for the approval would imply a divestment proceeds worth Rs 15,000 crore to Rs 16,000 crore per annum during the Tenth Plan period. Since 1991-92, the government had not realised more than Rs 5,371 crore in any financial year. In four financial years, the realisation was below Rs 1,000 crore.
Approval of the Plan document would mean that the government has to speed up and intensify the sell-off process, sources said. Now that the Plan document has been cleared by a body, the Planning Commission headed by Prime Minister, it would be difficult for anti-privatisation ministers to oppose it in its current form, sources said.
They, however, added that the ministry of disinvestment (MoD) was not very enthused with the Cabinet approval of the Plan document. In the view of the MoD, the current controversy about privatisation has nothing to do with arguments. It is the vested interests that are holding up privatisation.
The Tenth Plan document is unambiguous about divestment. It says that the government would get out of economic activities as a producer of non-strategic goods and services. Further, closure of sick public sector undertakings (PSUs) and quicker privatisation of others will release unproductive assets and direct them into more efficient sectors.
Similarly, the document says, the new initiatives to attract FDI make it possible to raise the level of FDI inflow from the present level of about $4 billion to $8 billion a year during the Tenth Plan.
The sum and substance of the Tenth Plan document, sources said, was categorically pro-growth and pro-reforms. Approving it in its current form, ministers would be committing themselves to growth and reforms, though how much this commitment translates into action would be another issue.
After Cabinet clearance, the Tenth Plan document will go to the National Development Council (NDC) for final approval. The NDC meeting is expected to be held in the first half of November.