Disinvestment: Government may target Rs 1 lakh crore for next fiscal

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The government will aim for a higher target next year through this mechanism and it may even be over Rs 1,00,000 crore,” said an official, who did not wish to be named.

The government has met its ambitious disinvestment target for the first time ever in 2017-18 and has mobilised a record Rs 91,253 crore till date as against the target of Rs 72,500 crore for the year.

While the amount raised through disinvestment stood at Rs 54,338 crore a fortnight ago, it climbed to over Rs 91,000 crore after the government announced that ONGC has bought its entire 51 per cent stake in Hindustan Petroleum Corporation Ltd for Rs 36,915 crore.

Experts say that given the current momentum in the market, the government can capitalise and divest their holding in some of the companies which interest investors. “While it will serve government’s purpose of meeting the revenue and fiscal deficit target for the year, it is also in line with the government’s stated objective that it should be a facilitator rather than running business,” said the head of a brokerage firm, who did not wish to be named.

Even as two months are left before the current financial year comes to an end, the government managed to meet the disinvestment target. The target of Rs 72,500 crore was the highest that the government had set for a year till now.

In the previous year the government had raised Rs 46,246 crore through disinvestment against a target of Rs 56,500 crore and thus the aggregate amount raised over the last two years stands at Rs 1,37,499 crore. Higher than budgeted disinvestment receipts should help the government in closing the shortfall in other sources of non-tax revenue. The government has estimated to receive Rs 74,901.25 crore as dividend/surplus from the RBI, national banks and financial institutions in the current financial year.

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While the surplus transfer from the Reserve Bank of India has fallen short of the target, dividend from state-owned banks are also likely to be lower than expected. The government is hoping to get higher dividend from public sector enterprises, for whom the target in the current year is Rs 67,529.24 crore. Dividend from banks and CPSEs are major source of non-tax revenue for the government.

Sources said the government is also hopeful of the RBI giving a special dividend.

The RBI in August announced that it will transfer Rs 30,659 crore as surplus to the government for the year ended June 2017, less than half the amount transferred last year. For the year 2015-16, the RBI board had approved the transfer of surplus amounting to Rs 65,876 crore to the government.