CPM slams Govt move allowing PSEs to invest in mutual funds

BANGALORE: The CPI-M on Saturday slammed the UPA government's move permitting Navaratna and Miniratna PSUs to park 30 per cent of their surplus funds in equity-based Mutual Funds, terming it a "retrograde step" and one which amounts to wasting public resources on socially unproductive investments.

Releasing its politbureau statement here, party General Secretary Prakash Karat said the CPI-M and Left parties had earlier suggested that the CPSEs utilise their reserves of over Rs 2,39,000 crore to massively increase capital investments for expanding their scale of operations and creating fresh capacity,thereby diversifying their activities.

It said the Union government can mobilise a part of this surplus by seeking higher dividends to fund infrastructure projects and social sector schemes.

"The UPA government seems to be more interested in fuelling the stock market boom by using public sector surpluses", the statement said.

"The experience of the UTI scam, where a huge amount of public funds was squandered through speculative investments, should have precluded such a reckless decision".

The CPI-M politbureau is opposed to this step, it said, adding the government should find better ways of utilising the surplus funds of the CPSEs in productive activities that generate employment and serve the interests of the people.