Disinvestment of public enterprises is criticised by leftoriented economists on the ground that it amounts to selling family silver. Read more about disinvestment of psus on business standard. Public sector units, disinvestment, coalition governments. The 201718 budget had set the disinvestment target in public sector units at rs 72,500 crore. Download free ebooks based on technical analysis in. Evaluation of strategic disinvestment of psus ias parliament. Disinvestment of public sector units in india wikipedia. In order to run the country the government will incur some expenses, like to pay salaries, clear loans taken from foreign banks, welfare activities, infrastructure works, defence etc. However, it is the government and not the psu who receive money from disinvestment. Strategic disinvestment is transferring the ownership and control of a public sector entity to some other entity mostly to a private sector entity.
To complete the disinvestment targets, government asks one psus to buy shares of another psu. The latest is the move of the government to disinvest psu shares targetting about rs. Disinvestment, government policy, management, privatisation, public sector. Disinvestment has been and continues to be a controversial topic both from the view point of economics and politics. Pdf the policy of government on disinvestments has been evolved over a period. Disinvestment as per sebi substantial acquisition of shares guideline, means the sale by the central governmentstate government, of its shares or voting rights andor control, in psus. Disinvestment proceeds are mostly used to cover fiscal deficit instead of growth purpose. Disinvestment in public sector units in india, is process of public asset sales by president of india on behalf of government of india, directly offer for sale to public or indirectly bidding process in capitalized market.
Disinvestment of the sharesequity of public sector enterprises. From may, 2004, the department of disinvestment became one of the departments under the ministry of finance. Disinvestment refers to the use of a concerted economic boycott to pressure a government, industry, or company towards a change in policy, or in the case of governments, even regime change. Should psus be allowed to participate in the b ids for disinvestment of psu. Disinvestment policy in india download ebook pdf, epub. Disinvestment disinvestment is a process in which the public undertaking reduces its portion in equity by disposing its shareholding. Onlyias helps students in preparation of civil service exams. Explore disinvestment profile at times of india for photos, videos and latest news of disinvestment. The cpses which have been given inprinciple approval for strategic disinvestment by the government are as under.
In the remaining cases, either mergers with other public sector units or strategic disinvestment is recommended. Public sector undertakings psu play an important role in shaping the industrial and economic environment. Public sector undertaking psu or a public sector enterprise is a government andor stateowned company, where most of the stock is majorityowned by the government. They can be classified as central public sector enterprises cpses and state. The planned ipo of indian railway finance corporation irfc and an rs 8,000crore sale of the centres stake in. Pdf on jan 1, 2014, sri santosh koner and others published disinvestment of public sector in india.
Recent disinvestment department of investment and public. In order to pay for these expenses the government must have som. Cabinet nod to list 11 psus flags off disinvestment for. In this direction, the government adopted the disinvestment policy. Disinvestment means sale of equity and bond capital invested by government in the psus. The following arguments are given against privatisation, that is, disinvestment of public sector enterprises. Pdf the disinvestment policy in india through a prism of. This included rs 46,500 crore as disinvestment of cpses, rs 15,000 crore from strategic disinvestment.
Also on sale will be a 31% stake in container corporation of india concor along with management control. Private sector wanted it, not the government it is important to see that not all public sector companies are lossmaking. This article was posted on jul 17, 2009 and is filed under market news. Disinvestment is the action of an organization or government selling or liquidating an asset or subsidiary. Psu and disinvestment free download as powerpoint presentation. The government of india has decided to withdraw from the industrial sector, and in accordance with this decision, it decided to privatize the public sector enterprises in a gradual and phased manner. Another issue underlying the disinvestment is the fiscal deficit target of 3. Click download or read online button to get disinvestment policy in india book now. Thus in 200102 to tal net profit earned by 230 central public sector units was. Disinvestment of public sector enterprises in india. Public sector enterprises in india the impact of disinvestment and. Pdf disinvestment of public sector undertakings special. Latest current affairs in april, 2020 about strategic disinvestment.
The government has so far raised rs 52,500 crore in the current fiscal through psu disinvestment, including from listing of. Disinvestment archives onlyias nothing else upsc ias. Further, if department of disinvestment wants to get away with commercial risks, why should it retain equity in disinvested psus, e. Clipping is a handy way to collect important slides you want to go back to later. In some companies, the aayog preferred to let revival plans run their course, before taking a call on their future. Given that revenue collections are not enough, the government is perhaps planning the sale of wellrunning psus to meet the fiscal deficit target. Latest current affairs in april, 2020 about disinvestment. In order to achieve the various objectives and goals of disinvestment many methods have been formulated and implemented.
Fiscal deficit is the difference between total revenue and total expenditure of the government. This was identified as an active tool to reduce the burden of financing the psus. Niti ayog had recommended closure or strategic sale of about 70 psus. Government ends fy20 divestment programme with rs 14,700cr shortfall. Protest and opposition by psu stakeholders trade unions and employees. Under fire from opposition for not paying salaries to a section of employees of the stateowned transport corporations,the mamata banerjee government,on friday,announced that the government would not hold salaries and pensions of the transport corporation employees for the next six months and ruled out. Cabinet approves strategic disinvestment of bpcl, 4. The objective of this paper is assess the financial performance of disinvested central public sector enterprises pses in india on the basis of several dimensions on pre and post disinvestment bases over the life span of more than two decades i.
The government kicked off a blockbuster disinvestment plan, lining up the sale of five public sector units psus, including majority stakes in bluechip oil company bharat petroleum corp ltd bpcl and shipping corporation of india. Home department of investment and public asset management. Unlike the simple disinvestment, strategic sale implies some sort of privatization. Bloomberg quint is a multiplatform, indian business and financial news company. Financial performance of disinvested central public sector. Article information, pdf download for pre and post disinvestment. The government of india has identified three public sector undertaking psu companies for disinvestment. The disinvestment the policy in journal of institute of india publicenterprise, through. Pre and post disinvestment performance evaluation of indian. Disinvestment in public sector units in india, is process of public asset sales by president of. Keywords central public sector enterprises cpses, disinvestment, public. The ffo 3 of cpseetf in november 2018 is the biggest disinvestment transaction. Finally, disinvestment was also seen by the government to raise funds for meeting generalspecific needs.
Disinvestment sale of shares of valued public sector units seems to be the most important work of the modi government. Now customize the name of a clipboard to store your clips. Cabinet nod to list 11 psus flags off disinvestment for 201718 the listing of companies will be through public offer of shares upto 25% of government of indias shareholding, which may include. Disinvestment means the dilution of stake of the government in a public enterprise. Need for a clear policy on disinvestment to stop this practice. Psus, disinvestment, public monies, and the shape of water. Taking your money out of the companies you invested in. Crisp news summaries and articles on current events about strategic disinvestment for. In such cases, disinvestment doesnt decrease government control over those companies. The erstwhile disinvestment policy has specific aims of modernization and up gradation of psus, creation of new assets, generation of. Under the strategic disinvestment of 33 cpses, the central government will be selling its majority stake and will transfer the management control to. Browse the categories below to see all current offerings, including subjectspecific software. The cabinet has decided to approve strategic disinvestment of the governments shareholding in five public sector enterprises psus.
As a penn state student, faculty, or staff member, a variety of software is available to you at reduced cost or at no additional cost. In the current year government targeted to raise as much as 30000 crores through disinvestments in psus having less than 25% of public holding. Rvnl indian railways catering and tourism corporation. In another set of suggestions, it has recommended strategic disinvestment on priority in 15 psus. Disinvestment means sale or liquidation of assets by the government, usually central and state public sector enterprises, projects, or other fixed. We combine bloombergs global leadership in business and financial news and data, with quintillion medias deep expertise in the indian market and digital news delivery, to provide high quality business news, insights and trends for indias sophisticated audiences.
Niti aayog making new list of sick psus for divestment. It will divest stake in kudremukh iron ore, manganese ore and nmdc. The term was first used in the 1980s, most commonly in the united states, to refer to the use of a concerted economic boycott designed to pressure the government of south africa into. Sixth corrigendum to pim for strategic disinvestment of air india and its subsidiaries regarding extension of last date for submission of eoi. Govt asserted that ais disinvestment shouldt face any issues this time as buyers have shown interest. Disinvestment policy of india project work slideshare. Read this article to know about the methods implemented to achieve objectives of disinvestment in india. If you have any doubt, anything related to upsc, always feel free to ask, we would try our best to address your grievance. What are the advantages of disinvestment in psus by indian.
The following main objectives of disinvestment were outlined. Crisp news summaries and articles on current events about disinvestment for ibps, banking, upsc, civil services. There is a possibility of creation of a privatesector monopoly. To download complete guidelines in pdf format, click here. Cabinet gives nod to disinvestment in nearly 60 psus. The social objective of formal jobs, need based goods, providing level playing field, etc.