Finance Minister Nirmala Sitharaman, in her Budget 2021 announcement, is expected to spell out the government's divestment plan for the current financial year. The year 2020, due to COVID-19 pandemic, was not a good year when it came to the Centre's PSU divestment plan.
The Union Budget 2020 had targeted Rs 2.1 lakh crore disinvestment in FY21, of which about Rs 1.2 lakh crore was expected to come from Central Public Sector Enterprises (CPSEs). The latest data shows only Rs 5,000 crore has been realised so far as the pandemic struck the economy. The government had budgeted disinvestment target of Rs 1.05 lakh crore for FY20 and Rs 80,000 crore for FY19.
Considering the unprecedented situation, the government is now thinking what all can be done during the post-Covid period to make up for the losses.
Tuhin Kanta Pandey, DIPAM Secretary, says the strategy is to build a strategic disinvestment pipeline, which does not happen overnight. "The finance minister has emphasised that the strategic disinvestment pipeline is important because that could add a lot of value not only to stocks of existing PSUs, because management control will be passed on, but also to the overall government philosophy that it need not be in business," he told Business Today.
The Centre had high hopes from the sale of Air India and BPCL but both these deals could not be inked.
Now the government has said that barring four strategic sectors, it will exit from all other PSUs. The finance minister, as a part of reforms in the Atma Nirbhar package in May 2020, said the government will come out with a new public sector enterprise policy, whereby certain strategic sectors will be listed in which there will be minimum public sector presence and beyond that the CPSEs will be considered for privatisation.
The Centre's first priority for the next fiscal year could be the stake sale in BEML, Neelanchal Ispat Nigam, Shipping Corporation of India and Concor. The decisions on privatisation of these PSUs were taken at the Cabinet level.
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