Dept of disinvestment looking at more ‘realistic’ target of Rs 40,000 crore in FY2017

For the financial year 2016-17, the Department of Disinvestment is keen on having a less ambitious fund raising target of about Rs 35,000- 40,000 crore, through stake sales in public sector units. The issue will be discussed with the Departments of Expenditure and Economic Affairs, which will ultimately finalize Budget targets for 2016-17. However, the Department of Disinvestment is more optimistic about PSU stake sales in 2016-17, with a policy on strategic sales which likely to be in place soon. 

For the financial year 2015-16, Union budget had set a target of Rs 69, 500 crore from PSU stake sales. Out of which Rs 41,000 crore is to be raised from minority stake sales and Rs 28,500 crore through strategic sales. So far the department has been able to raise just Rs 12,701 crore

Notably, the reliance on disinvestment proceeds is unlikely to ease even next fiscal year, with the Centre facing heavy and multiple expenditure demands, including those for implementation of the Seventh Pay Commission recommendations and the One Rank, One Pension scheme for defence personnel. Government in its Medium Term Fiscal Policy Statement of Union Budget 2015-16 has outlined plans to raise Rs 55,000 crore and Rs 50,000 crore in 2016-17 and 2017-18, respectively, as disinvestment proceeds.