Disinvestment target cut by ₹97,000 cr for FY22, FY23 target set at ₹65,000 cr

The government has drastically slashed the estimates of revenue from divestment proceeds by ₹97,000 cr for the 2021-22 financial year, from ₹1.75 lakh crore to ₹78,000 crore, as it has not been able to garner quite the support it wished to from sale of of its stake in public enterprises.

This was after the government could mop up only ₹12,030 crore from PSU disinvestment and strategic sale of its stake, including the sale of Air India to Tata for ₹2,700 crore.

Accordingly, the government has set the divestment target for the 2022-23 financial year at ₹65,000 crore, in the budget presented on Tuesday (February 1, 2022).

As per a 2020 CAG report, the government holds stake in 434 Central Public Sector Enterprises (CPSEs) at a value of ₹4,00,909 crore as on March 2019.

Over the last few years, the government has been planning to sell its stake in a number of such companies. The biggest of them all, this year is the listing of Life Insurance Corporation (LIC) on the stock exchange, which is expected by March.

The government is also working on the strategic sale of BPCL, Shipping Corp, Container Corp, RINL and Pawan Hans.

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In the last three years, the government has missed the disinvestment target. In 2019-20, the disinvestment receipts stood at ₹50,298 crore, lower than the Revised Estimates of ₹65,000 crore and Budget estimate of ₹1.05 lakh crore. In 2020-21, as against the budgeted disinvestment target of ₹2.10 lakh crore, the government had mopped up ₹37,897 crore.

However, the government exceeded the targets set for 2017-18 and 2018-19. In 2018-19 and 2017-18 fiscal, the government had exceeded the disinvestment target set in budget. In 2018-19, the disinvestment mop-up stood at ₹84,972 crore, as against the Budget target of ₹80,000 crore. In 2017-18, it bettered the target of ₹1 lakh crore and raised a record ₹1,00,056 crore.

In 2016-17, the government had missed the budgeted disinvestment target. While the Budget had pegged target at ₹56,500 crore, the government was able to mop up ₹46,247 crore.

In 2015-16, the government had realised ₹23,996 crore from CPSE disinvestment, lower than the Budget target of ₹69,500 crore.