Cabinet approves new mechanism to quicken strategic disinvestment

Sets up high-powered panel to decide on matters relating to terms and conditions of sale

Union Minister for Finance, Defence and Corporate Affairs, Arun Jaitley briefs a press conference after a Cabinet meeting in New Delhi (Photo: PTI)

The Cabinet today decided to set up a high-powered committee of Union ministers, including Finance Minister Arun Jaitley, to expedite strategic disinvestment of state-owned companies.

The Cabinet gave its nod for setting up an Alternative Mechanism (AM) consisting of Finance Minister, Road Transport and Highways Minister, and Minister of Administrative Department, to decide on the matters relating to strategic disinvestment, an official statement said after the Cabinet meet which was chaired by Prime Minister Narendra Modi.

The panel will decide on matters relating to terms and conditions of the sale from the stage of inviting of expressions of interest (Eols) till inviting of financial bid, the statement said.

Further, the Core Group of Secretaries will be empowered to take policy decisions with regard to procedural issues and to consider deviations as necessary from time to time for effective implementation of decisions of the Cabinet Committee on Economic Affairs (CCEA).

The revision in procedure and mechanism for strategic sale of PSUs, the release said, "will help in speedy completion of strategic disinvestment transactions".

The government has budgeted to raise Rs 72,500 crore through stake sale in PSUs. This includes Rs 46,500 crore from minority stake sale, Rs 15,000 crore from strategic disinvestment and Rs 11,000 crore from listing of PSU insurance companies.