Cabinet gives in-principle nod to disinvestment and strategic sale of PSUs

Candidates for sales, disinvestment to be decided on a case-by-case basis

The Cabinet on Thursday gave in-principle approval to strategice sale and disinvestment in the public sector units as recommended by the NITI Aayog.

Briefing reporters about  the Cabinet decision, Finance Minister Arun Jaitley said candidates for strategic sales and disinvestment would be decided on a case-by-case basis. 

He said PSUs or units up for sale would be brought in front of the Cabinet again on a case-by-case basis. 

The finance minister said sale methods and valuation for PSUs or units up for sale would be examined by the Department of Investment and Public Asset Management (DIPAM) and the line ministry. 

The government's disinvestment target for the current financial year is Rs 56,500 crore. Of this, Rs 36,000 crore is expected from minority stake sales and buybacks. The rest is expected from 'strategic sales' in loss-making or profit-making PSUs or their assets (factories, warehouses, office buildings, etc).

The government has managed Rs 21,000 crore through stake sales and buybacks in the first six months, the highest-ever first half divestment revenue for any year by a good margin, raising expectations for the rest of 2016-17. Of this, Rs 16,500 crore is from buybacks initiated by five PSUs. The rest is from five stake sales through the offer-for-sale route.

Other decisions by Cabinet:

• Setting up of a National Academic Depository as envisioned under Digital India programme. 
• Rs 500-cr Special Prime Minister Horticulture Package to Jammu and Kashmir. 
• Two per cent DA for Central government employees