PSU dividends only solace in government accounts

Non-tax revenue during April-Aug of 2013-14 constitutes 40% of target pegged for the entire year

The central government's accounts woefully fell short of its targets on the revenue side in the first five months of the current financial year. Surprisingly, its non-tax revenue showed quite a good contribution to the Centre's kitty. This is despite the fact that sale of spectrum has not yielded any revenue to the government so far, against about Rs 41,000 crore targeted in the budget.

Non-tax revenue stood at Rs 68,786 crore during April-August of 2013-14, constituting 39.9% of Rs 1,72,252 crore pegged for the entire year.

At this point of time, this category had yielded the government 29% of the Budget Estimate in 2012-13.

It was primarily the dividends and profits of institutions like RBI which delivered this. Of total non-tax revenue in the first five months, over 60% came from dividend and profits of public sector banks. These delivered Rs 41,665.27 crore to the government. The figure constituted 56% of the BE at Rs 73,866.36 crore.

Dividends of public sector enterprises and profits of those shared with the government accounted for 44% at this point of time in 2012-13.

Even then, this category made the exchequer fatter by Rs 55,443 crore in 2012-13 against the BE of Rs 50,153. If the trend persists, the figure may swell quite higher than Rs 73,866.36 crore pegged in the BE for the current financial year.

 
The government is seeking to keep its fiscal deficit within the budgetary target of 4.8% of GDP. Higher dividend from PSUs would make up part of the shortfall from disinvestment and lower receipts in other heads of accounts due to slowing economic growth.

The Ministry, according to officials, is hopeful of meeting the dividend receipt target in the current fiscal and has not sought any special dividend. However, they said the situation would be reviewed in January.

"Dividend payments by PSUs will not be less than last year's. In no case will we accept dividend less than last year's," Chidambaram told reporters after meeting heads of blue-chip PSUs such as Oil & Natural Gas Corp, Indian Oil, GAIL India, Steel Authority of India, NTPC and Coal India.