Govt earnings from PSU dividend, profit jump to over Rs 88,000 crore

This is Rs 14,320 crore more than the earlier estimate

Government pressure on public sector undertakings to pay more dividend seems to have worked as the exchequer got Rs 88,188 crore in this financial year, which is Rs 14,320 crore more than the earlier estimate.

As per the budget document presented in Parliament, public sector enterprises, including banks, are expected to contribute Rs 88,188 crore in the form of dividend and profit to the government in the current financial year.

Originally, the government had expected to get Rs 73,866 crore, of which Rs 29,870 crore had been targeted from PSUs and Rs 43,996 crore from banks.

The government estimates it will get Rs 77,229 crore from dividend and profits in 2014-15.

Finance Minister P Chidambaram had repeatedly asked PSUs to increase spending or dole out higher dividend to shareholders. The government is the majority owner of PSUs.

Maharatna firm Coal India alone provided Rs 19,000 crore to the government as dividend and dividend distribution tax.

The higher dividend collection helped the government to restrict the fiscal deficit to 4.6% of GDP in the current financial year when the PSU disinvestment programme did not take off as planned.

The government has so far raised Rs 3,500 crore from disinvestment in 2013-14 and revised its target to Rs 16,027 crore from Rs 40,000 crore.