Letters: Not quite correct

Shekhar Gupta's understanding of Prime Minister Narendra Modi's position on privatisation in the article, "Not quite the anti-Nehru" (May 28), is not quite correct. Gupta errs in referring to Gujarat Gas. The presence of Gujarat in the company's name leads him to believe that it is an old state public sector unit. It is, after a fashion, but a new one and not in the sense he would have the readers understand it and thus conclude that its non-privatisation is further proof of Modi's aversion to it. In fact, the reverse is true.

The present Gujarat Gas is the successor to a three-decade-old company of the same name, originally belonging to the Mafatlal Group, which sold its holding to British Gas. It is a listed company. In 2012, British Gas sold its 65 per cent holding to GSPC Distribution Networks, a subsidiary of Gujarat State Petroleum Corporation. Since then, all the natural gas distribution businesses of GSPC have been amalgamated into the new Gujarat Gas. Its present shareholding comprises 83 per cent with the promoter group and the rest with Gujarat State Fertilizers & Chemicals Limited, a state joint sector company. Thus, Gujarat Gas became a public sector undertaking only recently, towards the end of Modi's tenure as chief minister of Gujarat, through a conscious investment decision of another state public sector unit.

Modi had contemplated part stake sale in several of the state public/joint sector companies as far back as 2004-05. An expert committee was appointed to suggest the modalities. Its early deliberations drew stiff resistance from managements of the companies under consideration, almost all of whom were headed by officers of the Indian Administrative Service. The result was no further progress.

Ever the pragmatist, Modi's present position regarding divestment of government holdings in public sector undertakings must be seen in the context of this early setback to his efforts to do so in Gujarat.

Shreekant Sambrani Baroda

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