Privatisation of public sector units to drive divestment receipts: MoS

From now onwards, privatisation would be the primary mode of disinvestment receipts, Parliament was informed on Monday.

With disinvestment over a period of time, the scope for minority stake sale has declined, minister of state for finance Bhagwat Kishanrao Karad told the Lok Sabha in a written reply.

He said disinvestment of government equity in public sector units depends largely on market sentiment, investor interest and market valuation of stocks.

Disinvestment receipts constituted 0.95-4.68 per cent of the total receipts of the Centre during 2014-15 to 2020-21, according to data given by the minister in the House.

While the proportion was the least at 0.95 per cent during 2020-21, it was the highest at 4.68 per cent during 2017-18, showed the data.

Karad said the revised estimates (RE) for disinvestment receipts in 2020-21 was Rs 32,000 crore. As on March 31, 2021, the government has realised disinvestment receipts of Rs 32,845 crore, which is around 103 per cent of the RE in 2020-21.

“Due to volatile market conditions arising from Covid, the RE was significantly lower than the budget estimates (BE) for 2020-21,” he said.

The government pegged disinvestment receipts at Rs 2.1 trillion, including Rs 90,000 crore from disinvestment of public sector banks (PSBs) and financial institutions, that year.

GST compensation to states

As much as Rs 37,134 crore of the goods and services tax (GST) compensation was pending to states for 2020-21 and Rs 14,664 crore for the first half of the current fiscal year. This is after taking into account the amount released from the compensation fund and back-to-back loans, minister of state for finance Pankaj Chaudhary told the Lok Sabha.

He said the Centre is committed to releasing the full GST compensation to states and Union Territories in line with the GST (compensation to states) Act, 2017 for the transition period. This will be by extending the levy of compensation cess beyond five years to meet the revenue shortfall and servicing the loan through the special window scheme. “As far as states’ share of the central portion of GST is concerned, it is being released regularly,” said Chaudhary.

Fiscal council ruled out

The finance ministry has ruled out the setting up of a fiscal council as recommended by the N K Singh committee on Fiscal Responsibility and Budget Management. He said institutions such as the Comptroller and Auditor General of India, the National Statistical Commission and Finance Commission, perform some or all of the roles of the fiscal council, proposed by the FRBM Review Committee.

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