Bangalore: The Standing Conference of Public Enterprises (SCOPE), an apex professional organisation representing public enterprises, on September 20 suggested to the Central government to close some 70 public sector undertakings (PSUs) that are not viable in the long-run and cannot be revived.

SCOPE's chairman, D K Varma, told reporters that some 70 PSUs, which are doing well, should be given autonomy and political interference in their functioning must stop, so that they perform better.

Varma said there are some 100 other PSUs that are not making profits but have the potential for a turnaround and coming out of the red, and in them, government should take up financial restructuring and give stress to technology upgradation and induct a board of professionals to run them.

On PSUs which are performing well, he suggested that the government first seek dispersal of shareholding to larger number of people (IPO route) than resort to strategic sale.

According to him, the model of categorising PSUs into Navaratnas and mini-Navaratnas is working well, and more companies should be brought under them, which is definitely going to encourage them to perform better.

SCOPE asked the government to take up labour reforms quickly, saying multiple laws are a "great deal of handicap", and suggested "nationalisation" of labour laws. PSUs should be given flexibility to hire-and-fire in tune with their business requirements, Varma suggested.

SCOPE is not opposed to privatisation/disinvestment of PSUs per se but there should be clarity in the process and it should not be done in an ad hoc manner, Varma said.

He said the recent decision of the government in deferring privatisation of oil sector by three months has created "roadblocks" and "havoc in the economic reforms programme" and warned that international rating agencies are keeping a watch as to whether the reforms programme has been kept in the backburner.

Government, Varma stressed, should have a long-term strategic roadmap regarding disinvestment of PSUs and there should also be consensus across political spectrum in this regard.

He said in recent weeks, there has been a dithering by the government on the disinvestment process and expressed happiness that it has not been shelved, and that government is taking a re-look at the programme. "There should be clarity."

There is a strong need to recover the mounting non-performing assets (NPAs), Varma said, adding there is a thought emerging in the government to come out with a special law to realise or confiscate them.

PTI