Govt may seek higher dividend from cash-rich CPSEs

The government may seek higher dividend from cash-rich central public sector enterprises (CPSEs) to meet the shortfall in direct taxes and lower disinvestment proceeds for the current fiscal.
"We are examining the issue of higher dividend from CPSUs," official sources said.
Without naming companies, sources said cash-rich PSUs would be in a position to pay higher dividend, if required.
As per the Budget estimates for 2015-16, Rs 36,000 crore is expected to come as dividend from the public sector entities during the current fiscal.
As per norms, profit-making CPSEs are required to declare a minimum dividend of 20 per cent or a minimum pay-out of 20 per cent, whichever is higher.

In case of PSUs operating in oil, petroleum, chemical and infrastructure sectors, the minimum divided pay-out should be 30 per cent of the post tax profits.

The government expects revenue collection to fall short of the budgetary target by 5-7 per cent, mainly because of subdued growth in direct taxes.
Total tax revenues are likely to be around Rs 14 lakh crore in the current fiscal, as against the budget estimate of Rs 14.5 lakh crore.
Besides, there are fears that the government may not meet its disinvestment target.
The Finance Ministry is staring at a shortfall of Rs 50,000 crore in disinvestment target for the current fiscal.

The government had budgeted to raise Rs 69,500 crore via disinvestment of PSUs in current fiscal.
Of this, Rs 41,000 crore was to come from minority stake sale in PSUs and another Rs 28,500 crore from strategic stake sale.
However, with volatile stock markets, the government has been able to mop up Rs 12,700 crore through stake sale in four PSUs - Indian Oil, REC, PFC and Dredging Corp.