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Why government may miss disinvestment target this year too

12 January, 2017

The government is likely to miss its disinvestment target as it raised only Rs 23,528 crore till end of December against its target of Rs 56,500 crore for FY2016-17.

The government has missed its disinvestment targets by more than 40% in five out of the last six years. In FY2012-13, the government realised Rs 25,889 crore while its target was Rs 30,000 crore. In FY2009-10, the government managed to raise around 95% (Rs 24,581 crore) of its revised divestment target of Rs 25,958 crore. After that, it has never been able to reach that level.

In the current financial year, 66% of the total receipts until December came though the buyback mode. In this mode, the CPSE buys back its shares thereby reducing the number of outstanding shares in the open market. 

The amount the government raised through disinvestments in Central Public Sector Enterprises (CPSEs) will help it pare fiscal deficit. The planning body NITI Aayog has been assigned the task of identifying the CPSEs for strategic sale and also advise the government on mode and percentage of shares to be sold in each CPSE.

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Why government may miss disinvestment target this year too

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