CPSEs to pay rich dividends to government this fiscal

State-owned firms including Oil and Natural Gas Corp, Coal India and SAIL this fiscal will pay Rs 28,595 crore in dividend to the cash-strapped government.

The dividend payout by 23 profit-making central PSUs is about Rs 2,000 crore higher than the last year and has already been indicated or promised by the heads of the major PSUs in a recent meeting with the Finance Minister P Chidambaram.

The assurance comes as a response to the Finance Minister's order that "in no case less dividend compared to 2012-13 will be accepted".

He directed that CPSEs would need to declare special dividend if their capital expenditure (capex) fell short of target.

World's largest coal producer Coal India has committed a Rs 7,958 crore dividend, the maximum among the major PSUs, to government for current fiscal.

Next in the line is the oil major ONGC. It has committed a Rs 5,627 crore dividend, same as the last year, as the capex target of the company was almost at par up to September.

However, there were others like Indian Oil Corporation or Oil India who quoted less dividend than last year, but Finance Minister insisted they should give more or at least maintain the last year's level. A separate meeting would be held to sort out the issue.

"A dividend amounting to Rs 440 crore was indicated by IOC Chairman and Managing Director in the meeting. Chidambaram indicated that the proposal is not acceptable and directed it to enhance the dividend," a source said.

Owning to various reasons, GAIL is likely to incur loss this fiscal and it was indicated that as a result, dividend pay out would be downward at Rs 291 crore against Rs 700 crore last year.

"But the FM directed GAIL to enhance and declare 90 per cent as interim dividend for the current year," the source said.

Country's largest power generator NTPC had to bear the brunt of shortfall in capex programme for the current fiscal. NTPC's capex plans got affected due to contractual issues in Solapur, Mejia, Bongaigaon and Barh. Hence, the power major will have to dole out more than the last year. Accordingly, it has offered Rs 3,710 crore against Rs 2,667 crore paid last year.

However, there were instances also where the CPSE would pay less dividend like in Power Grid Corporation. This is due to government's stake dilution in the company. Last year, it had paid Rs 938 crore dividend, it would come down to Rs 746 crore for the current fiscal.

Government got around Rs 1,600 crore by selling its four per cent stake in PGCIL earlier this month.