Centre decides to open all public sectors for private companies, to stay in strategic areas

Union Finance Minister Nirmala Sitharaman on Sunday (May 17) announced that the Centre has decided to privatise state-run enterprises in non-strategic sectors and allow private companies to invest in all areas. Sitharaman made the announcement during a press conference as part of the centre's COVID-19 economic stimulus programme.

According to Sitharaman, the Centre will come up with a new "coherent" public sector enterprises policy that will define strategic sectors which will have not more than four Public Sector Undertakings or PSUs.

"A new Aatma Nirbhar Bharat (self-reliant India) will stand on a new Public Sector Enterprise Policy. In strategic sectors, at least one enterprise will remain in the public sector but private sector will also be allowed," the Finance Minister said.

The Union minister remarked that the government will soon announce the list of strategic sectors requiring presence of public sector undertakings in public interest.

"To minimise wasteful administrative costs, number of enterprises in strategic sectors will ordinarily be only one to four; others will be privatised or merged or brought under holding companies," Sitharaman said.

Sitharaman also announced that the Centre has decided to increase the borrowing limit of the states from 3 per cent to 5 per cent for the financial year 2020-21 only.

Sitharaman said that the Centre's decision will give extra resource of Rs 4.48 lakh to the states. "The Centre has decided to accede to the request of the states of increasing the borrowing limit from 3 per cent to 5 per cent, for 2020-21 only," she said.