On the back of estimates that said the Indian economy could grow at a rate of 9.2% in 2006-07, the Bombay Stock Exchange’s 30-stock index, the Sensex, soared to close at a new high of 14643.
The stock of Oil and Natural Gas Corp., however, lost more than Rs16, after the government scrapped its earlier appointment of R.S. Sharma, the company’s chairman and managing director. The market value of the company fell by around Rs3,500 crore and the stock closed at 891.65pts.
Petroleum minister Murli Deora said that the new chairman would be appointed by May and that executives from the private sector were free to apply. “A committee will be formed within a week to begin the selection process,” he said.
“The Appointments Committee of the Cabinet (ACC) desired that a wider pool of talent, including from the private sector, be invited for consideration of a body that is wider than the conventional Public Enterprise Selection Board (PESB),” petroleum secretary M.S. Srinivasan told reporters.
Sharma’s appointment was rejected by the Prime Minister’s Office after it had been cleared by the Central Bureau of Investigation, the Intelligence Bureau, and the Central Vigilance Committee.
Srinivasan said the new search panel would be headed by the chairman of PESB and comprise two members of the board, himself, and two independent ‘eminent personalities’. Srinivasan added that “no adverse finds have been recorded against R.S. Sharma and A.K. Hazarika (who was the number two choice of PESB in interviews held last year).
The minister refused to explain why the government had acted now, five months after the selection board had made its decision. ONGC slipped to the second position in terms of market capitalization.