Global volatility in capital and currency markets has derailed the Rs 69,500-crore PSU stake sale programme for the year, but the government will go ahead with prudent and timely disinvestments, target for which should not be just confined to dates, a top official has said.
“Targets are set for best efforts and affirmative action. We have to operate in an environment which cannot be predicted and managed and in present day scenario, there are more pressing global issues than the domestic conditions,” Disinvestment Secretary Neeraj Gupta said.
Set a steep target of Rs 69,500 crore in current fiscal, the Department of Disinvestment (DoD) has been able to raise over Rs 13,300 crore so far this fiscal by selling stake in five PSUs as volatile equity markets played truant and delayed the stake sale plans.
“Target should not be confined to dates. Prudently and timely disinvestment will take place. You should not compartmentalise the target on dates.
“At the right environment, the government is committed to pursue the minority stake sale and disinvestment process will continue. It is a process in continuum. We will do it in right window, right opportunity,” Gupta added.
Volatile market conditions have affected the government’s disinvestment plan, which mostly have commodity and oil stocks in the pipeline.
So far this fiscal, the Sensex has plunged over 15% on various global factors including fears of interest rate hike in the US, China slowdown and uncertainties in Eurozone.
“In present day scenario, the global cues are dominating (stock markets). There are two sides to a set target – one is efforts and the second is correct environment. Government is keeping in mind the market conditions and is committed (to disinvestment),” Gupta said.
Although, since the beginning of the year the disinvestment department had lined up about two dozen PSUs for stake sale and putting in place Cabinet approvals for launching the stake sale.
It has so far been able to sell stake in 5 PSUs – Rural Electrification Corp (Rs 1,608 crore), Power Finance Corp (Rs 1,671 crore), Dredging Corp of India Ltd (Rs 53.33 crore), Indian Oil Corp (Rs 9,369 crore) and Engineers India Ltd (Rs 640 crore).
With this, the government is on the brink of missing disinvestment target for the sixth year in a row.