CPI (M) condemns decision to permit CPSE to invest in mutual funds

New Delhi, July 28 (UNI) Polit bureau, the highest policy making body of the Communist Party of India (Marxist), today condemned the Government's recent decision to permit the Navaratna and Miniratna Public sector enterprises to park 30 per cent of their surplus funds in equity based mutual funds as a retrograde step.

In a statement issued here, the party said channelising public sector funds into the secondary market in order to make speculative capital gains, amounts to wasting public resources on socially unproductive investments.

The CPI (M) and the Left Parties had earlier suggested that the reserves of over Rs 2,39,000 crore currently being held by the CPSEs, should be utilised by massively increasing capital investments by CPSRs in Contractor Purchasing System Review (CPSRs) expanding their scale of operations and creating fresh capacity and diversifying their activities.

The Central Government can also 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 experience of UTI scam, where a huge amount of public funds was squandered through speculative investments, should have precluded such a reckless decision, the statement added.

UNI