The Centre is confident of earning ₹2-lakh crore in fiscal 2016-17 from minority stake sales in public sector firms alone.
Data available with the Department of Investment and Public Asset Management reveal that the Centre has raised ₹1.91 lakh crore between 1991-92 and 2015-16 from minority stake sales in public sector firms.
“If things go as planned, we will exceed a cumulative of ₹2 lakh crore from just minority stake sales in PSUs this fiscal. What we achieve from strategic sales will be over and above this,” said a Finance Ministry official, adding that 2015-16 witnessed a record high from disinvestment proceeds, which exceeded the Revised Estimate as well.
In 2015-16, the Centre mopped up its highest ever revenue from divesting stake in 10 firms that helped raised ₹32,148.80 crore as against the target of ₹25,300 crore
While most of these were plain vanilla disinvestment of five per cent to 10 per cent, it also included share buybacks in Bharat Dynamics Ltd and Hindustan Aeronautics Ltd that helped raise ₹198.85 crore and ₹4,284.37 crore respectively. Further, ₹1,023.42 crore was raised as buyback tax from these two transactions.
The Centre also raised ₹8,152.00 crore by selling its debentures in NTPC to the Employees’ Provident Fund Organisation.
Prior to this, the highest collection from disinvestment proceeds was in 2014-15 when the Centre raised ₹24,277.17 crore.
Numerous reports in the past have, however, indicated that this could be just the tip of the iceberg and the Centre could raise much more from stake sales.
The Fourteenth Finance Commission had identified 88 PSUs with marginal turnovers, little market share and in non-priority areas that could be easily “relinquished”.
While announcing another ambitious target of ₹36,000 crore from minority stake sales this fiscal, Finance Minister Arun Jaitley had however, in the Budget indicated that the government will not go in for blind disinvestment but will also look to improve operational and financial efficiency in state run firms.
In 2016-17, the Finance Ministry plans to divest stake between five per cent and 15 per cent in a dozen PSUs including ONGC Ltd, Coal India Ltd, India Tourism and Development Corporation Ltd (ITDC) and Rashtriya Chemicals and Fertilisers.