Proposal of PSUs to invest in MFs referred to CoS

New Delhi, May 17 (UNI) The Cabinet Committee on Economic Affairs (CCEA) today referred the proposal to lift the ban on government-owned companies from investing in mutual funds to a committee of secretaries.

Finance minister P Chidambaram confirmed this to reporters after the CCEA meet presided over by Prime Minister Manmohan Singh.

Reports suggest that 78 listed public sector units had reserves worth Rs 304,292 crore at the end of March 2006. Oil and Natural Gas Corporation (ONGC) with reserves of Rs 52,534 crore topped the list.

Experts say this is an important income-earning opportunity for state companies which will strengthen them.

A month ago, the government allowed the chairmen of such companies a role in the appointment of independent directors, also allowing them greater flexibility to make investment and operational decisions.

UNI