MEANING OF DISINVESTMENT

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Presentation transcript:

MEANING OF DISINVESTMENT In general terms Disinvestment is simply selling the equity share invested by the government in Public Sector Enterprises (PSU).

Objectives of Disinvestment of PSU Reduce the Fiscal deficit Introduce New Management Faster realization value Introduce Capital for the company Reduce Financial Burden on Government Improve Public Finances Introduce Competition with Market Discipline Encourage Wide Share in Ownership Depoliticize Essential Services

METHODS OF DISINVESTMENT Transfer of Complete Management Partial Selling of Shares by Government

Current Disinvestment policy – The Salient Features In all cases of disinvestment, the Government would retain at least 51% equity and the management control In any listed PSU in government shareholding is less than 90% than government reduce through FPO or Offer for Sale. Public Sector Undertakings are the wealth of the Nation and this wealth should rest in the hands of the people All cases of disinvestment are to decided on a case by case basis.

Disinvestments in various PSU

Problems associated with Disinvestment Loss of Public Interest Fear of foreign control Issues with workers Policy adopted by the government. Multiple Control authorities Disinvestment process is not completely open and transparent.

Forthcoming Disinvestments - Government Approval Received OIL & NATURAL GAS CORP.LTD. STEEL AUTHORITY OF INDIA LTD. HINDUSTAN COPPER LTD. NBCC Ltd. BHARAT HEAVY ELECTRICALS LIMITED

THANK YOU