Government Secures Rs 20,000 Crore Through Disinvestment and Asset Sales
NEW DELHI: The Indian government has generated approximately Rs 20,000 crore from disinvestment and asset sales in the first two months of the financial year. This effort is part of a strategy to increase non-tax revenue amid rising subsidy costs linked to the ongoing conflict in West Asia. The amount raised so far represents about 25% of the government’s full-year target.
The fertiliser ministry has requested a doubling of its subsidy for the current fiscal year, which is budgeted at Rs 1.7 lakh crore. This comes as domestic manufacturers are urged to enhance production in response to escalating prices. There are also concerns regarding ship availability and several fertiliser suppliers withdrawing from the market. Additionally, the Centre has provided over Rs 1.2 lakh crore in support to the oil sector, including excise cuts, to mitigate the effects of high crude oil prices.
No need to review spending plans: Official
Oil companies have raised prices, and further increases are anticipated. The government will also need to subsidize cooking gas cylinders, as oil companies are currently facing losses of around Rs 700 crore daily. A senior official stated that there are no plans for spending cuts or realignments at this time, nor will there be a request for additional expenditure approval during the upcoming monsoon session. A clearer financial picture is expected by mid-July when first-quarter trends are available.
Despite the disruptions caused by the West Asia conflict, the finance ministry is focusing on raising funds through disinvestment and asset monetisation. Finance Minister Nirmala Sitharaman is reviewing the situation, with the Department of Investment and Public Asset Monetisation (Dipam) and the Department of Public Enterprises preparing a pipeline for both the current year and the medium term. So far, Rs 12,166 crore has been raised through disinvestment, while Rs 6,367 crore has come from asset monetisation. Dipam has utilized offer-for-sale methods to generate funds from Central Bank of India, Coal India, and NHPC. The government’s recent offer to divest up to 3% stake in NLC India was subscribed 5.2 times on its opening day, potentially raising another Rs 1,260 crore. However, plans for strategic sales, including the IDBI Bank stake sale, remain uncertain.
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