I refer to an article in your esteemed daily dated January 13. 1993 by your Special Reporter suggesting that the disinvestment of National Tubes would force the buyers to Import pipes.

I am a regular reader of your newspaper. 1 presume your objectives are to promote free enterprise and market oriented economy. The concept of privatisation is a dear and cherished goal.

At the onset I would like you and your readers to recognise the fact that National Tubes was an enterprise set up by private sector in mid 1960s albeit it was the Adamjce Group of Pakistan. After our liberation, this industry was abandoned by its original management and had to be sequestered and placed under the control of the Bangladesh Engineering and Shipbuilding Corporation.

During most of the 1970s this company grew as a result of monopoly and restrictive controls on import of small dia pipes for water and natural gas Industries. The major beneficiaries of such regressive measures were rent seekers and touts of the previous government who were agents and suppliers of other public sector institutions which procured the pipes of National Tubes. Uttle imagination is required to Infer the needs of agents in transaction between public sector organisations. In this case National Tubes and public sector buyers such as Petrobangla and its sub-

sidiaries eg. Titas etc. Your special reporter has failed to recognise the special interest groups which are working against our national Interest.

The contention of your special reporter regarding the API approvals is not correct. There is no reason to consider the fact that as a public enterprise National Tubes is in a better position to obtain API (American Petroleum Institute) approval when almost all manufacturers of the world are in the private sector. A private group which would take over the company would indeed by a better judge of relating Itself to the market needs and would or otherwise obtain international standard approvals for its products provided the marketing needs dictates it to do so.

With liberalisation of imports, let the buyer decide his source of supply. Nation I Tubes Is an important ente. prise but not a strategic one. if the buyers decide to buy from elsewhere it would only prove that National Tubes is no longer economically advantages to them. They have no reason to continue to support a falling and mismanaged company. And If they do so it would be at an extra cost to themselves.

It is in poor spirit that your special reporter refers to the Asian Developments Banks requirements In respect of privatisation of this enterprise. He has failed to recognise the democratic spirit of today and the economic changes which

are taking place all over the world. This government is committed to privatisation for the simple reason that It does want to continue nurturing the serpents of vested groups. And this vested group both in public, political and bureaucratic sectors are finding that their rent seeking capabilities are suddenly diminishing.

Even the previous regime recognized the writings on the walls and instead of committing itself to total privatisation used subterfuge to. support crony capitalism instead. The partial privatisation was a mere disguise. But in any case it was the first step towards a Herculean task and did start reflecting through accountability of a listed company, the true status of these enterprises in the public sector. Over ten companies were converted into public listed companies during the mid 1980s. 49 per cent of the shares were floated (a portion retained for employees). These were freely traded on the stock exchange and started reflecting the true economic strength or otherwise of these companies. Today, National Tubes Is quoted a round Taka 60, at a discour,, which reflects the sum of tl ic years it has cheated the exchequer and Its true owners the people of Bangladesh.

The government is the owner of 51 per cent of the equity of National Tubes. This block of shares along with the shares of the individual investors and employees is

worth about 60 per cent of its nominal \(aluc. All these shares are listed In the stock exchange and may be freely traded on the floor of the exchange. The government not unlike any other shareholder may place this sale on the floor of the exchange at the best available price which is decided then and there. But instead the government wants to do something else because the government servants are afraid of the free market, something they cannot control. A sale through tender would give them a better opportunity to play with the bidders and a position to play games and procrastinate.

The government must privatise but there are some reservations in respect of its present procedure which Is not fair and equitable to the other shareholders. The Dhaka Stock Exchange should have reacted and delisted these shares unless the government conforms to the regulations of the exchange to which the government is a party.

The real problem in bringing about change in conformity with the needs of the hour depends on the government's ability to differentiate between the needs of the people and those of some beneficiaries and the rent seekers who are today afraid that the carpet is being swept from under their feet.

(The author is a member of Dhaka Stock Exchange and past Councillor and Vice Chairman.)