In a bid to ease the liquidity pressure in the monetary system, the union government has directed public sector enterprises to keep their surplus funds with public sector banks (PSBs) without any competitive bid. Total surplus funds amounts to about 1,00,000 cror. This amount would meet fund requirement of the banks, as they have already used funds to cover government sponsored farm loan waiver and other debts.

Union finance minister, P Chidambram recently held a meeting with the chiefs of Central public sector enterprises (CPSEs) and apprised them about the government decision. ONGC Chairman and Managing Director, R.S. Sharma said that all PSUs would follow the guidelines of union finance ministry for surplus funds. The meeting was also attended by GAIL Chairman U. D. Choubey, SAIL Chairman S. K. Roongta, BSNL chief Kuldeep Goyal and other top officials of the ministries of petroleum, power and finance.

The chiefs of all PSUs such as State-owned gas major GAIL, steel major SAIL, telecom giant BSNL and ONGC pledged to keep their surplus funds with PSBs.

Earlier, CPSEs used to park funds with financial institutions through competitive bidding, leading to high interest rate on the amount. The recent decision of the government would force them to park funds at low interest rate with state run banks. It would impact the margin of public sector enterprises.