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Govt under pressure from BJP on UTI issue

Our Bureau

NEW DELHI, July 29

THE Government has come under pressure from within its own party ranks on the controversy surrounding the Unit Trust of India.

The BJP's national executive has sought a ban on private placement of shares by UTI and a thorough probe into all the investment decisions of the UTI in the last 10 years. The party wants the Government to examine the nexus between corporates and the UTI management regarding insider information prior to the July 2 decision of UTI to freeze sales and repurchase of units of US-64.

The Finance Minister, Mr Yashwant Sinha, on his part has told his party colleagues that a probe has already been ordered and that those found guilty would not be spared.

Further, the party's national executive has also sought a cleaning up act in the financial sector -- especially of the financial and investment institutions such as the IDBI and the LIC. A resolution was redrafted following widespread criticism at the me eting on the UTI fiasco.

There has been disquiet in the party over the handling of the UTI issue by the Finance Minister and also the state of the economy. Now with more allegations being aired by the former Chairman of UTI, Mr P.S. Subramanyam, against the Finance Ministry, the Government is in a spot.

Besides the cleaning up act in the financial sector, the BJP national executive has called for empowering SEBI on the lines of the Securities Exchange Commission (SEC) of the US. Mr Sinha had said in the last session of Parliament that the Government wou ld strengthen the powers of SEBI. A draft Bill aimed at bolstering SEBI is now in the process of being cleared.

What the executive has sought is empowering SEBI to regulate all the schemes of UTI to ensure that the Trust functions in a transparent manner.