Disinvestment: Government may sell stake in 3 PSUs -Governance Now

Disinvestment: Government may sell stake in 3 PSUs

The government aims to raise Rs 36,000 crore revenue from minority stake sales in PSUs in 2016-17. Another Rs 20,500 crore will be raised from strategic stake sales in PSUs.

GN Bureau | July 20, 2016

#stake sale #PSUs #disinvestment #current fiscal

The government is moving ahead with the plan for strategic disinvestment of the selected public sector undertakings (PSUs). And there could be at least two-three such stake sales in the current fiscal.

According to a news report in The Financial Express, the idea is to create momentum before accelerating such sales in the remaining period and use the non-debt revenue generated to fund development activities and infrastructure projects.

NITI Aayog, which has been given the task to identify the PSUs for strategic sale, has already submitted two reports: the first identified 74 sick and loss-making companies for action while the second is to have recommended strategic disinvestment of about 30 other companies. The Aayog is preparing a second list of companies for strategic disinvestment to include more companies in the pipeline to be disinvested. In a strategic disinvestment, government stake can come down to below 49 percent in a PSU from up to 100 percent now. However, it could often take a long time to materialise depending on the complexity of the issues and the company involved.

The administrative ministries and the department of investment and public asset management (Dipam) have been asked to work out the details on how to go about the strategic stake sales.

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