Union Cabinet clears new divestment policy
31 Jan 2021
2 Min Read
CW Team
The Union Cabinet cleared the new policy for Public Sector Enterprises (PSEs) last week. A broadsheet for disinvestment is expected to be announced by Finance Minister Nirmala Sitharaman in the Union Budget.
The Cabinet Committee of Economic Affairs cleared the Public Sector Enterprises (PSE) policy, said sources.
The policy was announced as part of the "Atmanirbhar Bharat" initiative in May 2020 by Finance Minister Nirmala Sitharaman.
The Finance Minister had then said that a list of strategic sectors requiring the presence of PSEs in the public interest would be notified. Sitharaman had said that in strategic sectors, at least one enterprise would remain in the public sector but the private sector will also be allowed. In other sectors, PSEs will be privatised.
To minimise wasteful administrative costs, the number of enterprises in strategic sectors will ordinarily be one to four. Others will be privatised,merged or brought under holding companies, Sitharaman had said.
4th Indian Cement Review Conference 2021
17-18 March
Make in Steel 2021
24 February
The new policy is expected to push disinvestment, whether minority or strategic sale (selling the entire stake or a larger slice with management control). There are over 200 Central PSEs out of which only 55 are listed. This gives an opportunity for minority stake sale and gets the Central Public Sector Enterprise (CPSE) listed on stock exchanges besides smaller stake sale in listed CPSEs. At the same time, many CPSEs, listed or unlisted, can be sold strategically.
With the government having a hard time collecting taxes, especially direct taxes, disinvestment can mobilise resources for various schemes. The government can use the proceeds for infrastructure spending.
For the current fiscal, the government hopes to raise Rs 2.10 lakh crore from disinvestment. This includes Rs 1.20 lakh crore from stake sale in CPSEs and Rs 90,000 crore from stake sale in Life Insurance Corporation (LIC) and IDBI Bank. So far in the current fiscal, the government has managed to realise only Rs 17,957 crore.
Also read: What is strategic about divestment?
Also read: Economic Survey is right on overregulation
The Union Cabinet cleared the new policy for Public Sector Enterprises (PSEs) last week. A broadsheet for disinvestment is expected to be announced by Finance Minister Nirmala Sitharaman in the Union Budget.
The Cabinet Committee of Economic Affairs cleared the Public Sector Enterprises (PSE) policy, said sources.
The policy was announced as part of the Atmanirbhar Bharat initiative in May 2020 by Finance Minister Nirmala Sitharaman.
The Finance Minister had then said that a list of strategic sectors requiring the presence of PSEs in the public interest would be notified. Sitharaman had said that in strategic sectors, at least one enterprise would remain in the public sector but the private sector will also be allowed. In other sectors, PSEs will be privatised.
To minimise wasteful administrative costs, the number of enterprises in strategic sectors will ordinarily be one to four. Others will be privatised,merged or brought under holding companies, Sitharaman had said.4th Indian Cement Review Conference 202117-18 March Click for event infoMake in Steel 202124 February Click for event info
The new policy is expected to push disinvestment, whether minority or strategic sale (selling the entire stake or a larger slice with management control). There are over 200 Central PSEs out of which only 55 are listed. This gives an opportunity for minority stake sale and gets the Central Public Sector Enterprise (CPSE) listed on stock exchanges besides smaller stake sale in listed CPSEs. At the same time, many CPSEs, listed or unlisted, can be sold strategically.
With the government having a hard time collecting taxes, especially direct taxes, disinvestment can mobilise resources for various schemes. The government can use the proceeds for infrastructure spending.
For the current fiscal, the government hopes to raise Rs 2.10 lakh crore from disinvestment. This includes Rs 1.20 lakh crore from stake sale in CPSEs and Rs 90,000 crore from stake sale in Life Insurance Corporation (LIC) and IDBI Bank. So far in the current fiscal, the government has managed to realise only Rs 17,957 crore.
Also read: What is strategic about divestment?
Also read: Economic Survey is right on overregulation
Image Source
Next Story
HCL-Foxconn to invest Rs 37 billion in chip plant near Jewar airport
The Union Cabinet has approved the establishment of a new semiconductor unit near Jewar airport in Uttar Pradesh under the India Semiconductor Mission. This sixth plant, a joint venture between HCL and Foxconn, marks further progress in India鈥檚 semiconductor journey. The project will see an investment of Rs 37 billion.The facility will produce display driver chips for mobile phones, laptops, automobiles, PCs, and other digital devices. It is designed for a monthly capacity of 20,000 wafers and an output of 36 million units.Five semiconductor units are already in advanced stages of constructi..
Next Story
Brigade acquires Velachery land for Rs 16-billion project
Brigade Enterprises has acquired a 5.41-acre land parcel on Velachery Road, Chennai, through an outright purchase for Rs 4.417 billion. Located next to Phoenix Market City, the site will be developed into a premium residential project with a gross development value of approximately Rs 16 billion and a development potential of 0.8 million square feet.The project offers strategic access to both the OMR IT Corridor and Chennai鈥檚 Central Business District, promising strong connectivity and premium lifestyle offerings. Brigade plans to create signature residences focused on aesthetics, functional..
Next Story
Liebherr marks 10,000th XPower wheel loader milestone
Liebherr-Werk Bischofshofen has rolled out its 10,000th XPower wheel loader, marking a major production milestone. The anniversary L 580 XPower model, featuring a power-split travel drive developed with ZF Friedrichshafen AG, was handed over to the BERGER Group in Passau.鈥淭he transmission from our partner ZF is a key component of the drivetrain in our XPower wheel loaders,鈥� said Gerhard Pirnbacher, Head of Quality Management at Liebherr. 鈥淲ith an impressive total of around 64 million operating hours already clocked up by XPower models, this transmission has proven its exceptional robustn..
