The principle of the government’s disinvestment programme is not to shut down any unit or company but to make them more efficient and professionally driven, said Finance Minister Nirmala Sitharaman on Friday, as per PTI report.
The minister pointed out that public sector enterprises that were privatised between 1994 and 2004 are now led by professionally run boards, and that these businesses have only improved.
Sitharaman said privatisation of CPSEs is aimed to ensure that these companies are run efficiently and cost effectively. She was addressing the iconic week celebrations of the Department of Investment and Public Asset Management (DIPAM) as part of ‘Azadi ka Amrit Mahotsav’, said PTI.
According to PTI, the principle with which disinvestment is happening now is not to shut down a unit. The economy needs that many number of such companies and many, many more as well.
“So if we want to have that activity done professionally and open up spaces for people to come and do it, our interest is not to shut down, we want to prime it up, we want to have them to run far more efficiently so that contributions can be made to the economy,” Sitharaman said in her webcast speech from Bengaluru.
She explained that the principle of disinvestment is to ensure that companies being privatised are in the hands of people who can run them, bring in more capital, and maintain the same level of output.
“So it’s not to close down but to bring in opportunity for better and more investments to be made,” Sitharaman said.
Over a half-dozen companies have also been identified for strategic sale by the government. Shipping Corp, CONCOR, Vizag Steel, IDBI Bank, NMDC’s Nagarnar Steel Plant, and HLL Lifecare are among them.
The government has collected nearly Rs 24,000 crore from CPSE disinvestment so far this fiscal year. The complete fiscal year’s objective has been set at Rs. 65,000 crore, PTI said.
Over Rs 13,500 crore was realised through CPSE disinvestment in the previous fiscal year, including the sum realised through the privatisation of Air India.
CPSE Bharat Bond ETF, according to the minister, constitutes around 84 percent of all Exchange Traded Funds in the market. Bharat Bond ETF has an AUM (asset under management) of around Rs 53,000 crore, said PTI.