New Delhi: Government Monday said PSUs will now have to monetise their idle assets for new investments, while renaming the Department of Disinvestment to Department of Investment and Public Asset Management (DIPAM).
Finance Minister Arun Jaitley today said the the NITI Aayog will identify the state-owned companies which would be eligible for strategic sale.
"We have to leverage the assets of CPSEs for generation of resources for investment in new projects. We will encourage CPSEs to divest individual assets like land, manufacturing unit to release their asset value for making investments in new projects," Jaitley said in his Budget 2016-17 speech.
He said this will be new policy for management of government investment in public sector enterprises including disinvestment and strategic sale and Disinvestment department is being renamed as the DIPAM.
"The NITI Aayog will identify the CPSE for strategic sale. We will adopt a comprehensive approach for efficient management of the government investment in CPSEs by addressing issued such as capital restructuring, dividend, bonus shares," Jaitley said.
The government will soon come out with a comprehensive policy for strategic stake sale that will detail the mode as well as valuation methodology for outright sale of even profit making companies.
The previous NDA government led by Atal Bihari Vajpayee had between 1999 and 2004 privatised about a dozen state-owned firms and hotels including Videsh Sanchar Nigam Ltd (VSNL), Bharat Aluminium Company Ltd (BALCO), CMC Ltd and Hindustan Zinc (HZL). But the policy was buried after the UPA came to power and only minority stake sales was pursued since then.
The government is now looking at reviving the policy.
In the Budget for 2015-16, Jaitley had said the government will raise Rs 28,500 crore by way of strategic stake sale.
But with no specific policy detailing how to select a PSU for strategic stake sale, methodology for valuation and the process to be followed, the disinvestment department could not go ahead with selling any PSU so far this fiscal.
The vacuum is being sought to be filled with a comprehensive policy.
Also, the policy would cover both profit and loss making CPSEs, much on the lines of the report of two Disinvestment Commissions which had submitted their reports in the previous NDA regime.