Forcing public sector firms to shell out more money seems to be a strange way to reduce the government’s fiscal deficit. If reports are to be believed, that is what the Union government plans to do.
A Bloomberg story on Monday said ONGC may be asked to fork out Rs 470 billion this fiscal as compared with Rs 248.9 billion the year before. This massive rise is due to its share in bearing the subsidy burden.
In India’s oil politics, this is the path of least resistance for those who take such decisions in New Delhi. It is also damaging to ONGC’s financial health.
It is hardly surprising then that the government is unable to rustle up investor interest in the company. A follow-on public offer had to be deferred. One does not have to think hard why.
Either way, the only thing that seems to interest the government is how to lay its hands on the biggest pile of cash in front of its eyes.