Budget pegs FY22 disinvestment target at Rs 1.75 lakh crore

The Budget proposals for 2021-22 on Monday put Rs 1.75 lakh crore as a target from stake sale in public sector companies and financial institutions.

The Budget proposals for 2021-22 on Monday put Rs 1.75 lakh crore as a target from stake sale in public sector compes and financial institutions.

Finance Minister Nirmala Sitharaman said the government aims at making use of disinvestment proceeds to finance various social sector and developmental programmes besides infusing private capital, technology and best management practices.

"A number of transactions -- Bharat Petroleum Corporation Ltd, Air India, Shipping Corporation of India, Container Corporation of India, IDBI Bank, BEML, Pawan Hans and Neelachal Ispat Nigam Ltd -- among others are proposed to be completed in FY 2021-22," she told Parliament.

Other than IDBI Bank, a proposal of privatisation of two public sector banks and one general insurance company will be taken up in the year 2021-22. The initial public offering of Life Insurance Corporation (LIC) will also be brought in through requisite amendments in the session itself.

Sitharaman said the government has approved a policy of strategic disinvestment of public sector enterprises that will provide a clear roadmap for disinvestment in all non-strategic and strategic sectors.

Fulfilling the governments' commitment under the Atma Nirbhar Package of coming up with a policy of strategic disinvestment of public sector enterprises, the minister said four sectors will come under it: atomic energy, space and defence; transport and telecommunications; power, petroleum, coal and other minerals; banking, insurance and financial services.

The policy will cover existing central public sector enterprises, public sector banks and public sector insurance compes. In strategic sector, there will be bare minimum presence of the public sector enterprises and the remaining ones to be privatised or merged or subsidiarised with other central public sector enterprises or closed.In non-strategic sectors, central public sector enterprises will be privatised or closed.

To fast forward the policy, NITI Aayog has been asked to work out on the next list of central public sector compes to be taken up for strategic disinvestment.

Sitharaman said to incentivise states for disinvestment of their public sector compes, an incentive package of central funds will be worked out.

A special purpose vehicle will be created in the form of a company to carry out monetisation of idle land. This can either be by way of direct sale or concession or by similar means.

The Finance Minister also proposed to introduce a revised mechsm that will ensure timely closure of sick or loss-making central public sector enterprises.

( With inputs from ANI )