Govt falls short of disinvestment target, posts stronger dividend receipts

The Department of Investment and Public Asset Management (DIPAM) on Friday said the government fell short of its disinvestment target for FY23, the second consecutive year they failed to do so. The shortfall was close to 30 per cent at Rs 35,294 crore. Despite this, the government maintained a sustained growth in dividend from Central Public Sector Enterprises (CPSEs).

The dividend receipts from CPSEs grew more than 37 per cent to Rs 58,988 crore against the Revised Estimates (RE) target of Rs 43,000 crore. In FY22, the dividend receipts recorded were about Rs 59,294 crore.  

The government has received about Rs 268 crore from SAIL, Rs 736 crore from Nuclear Power Corporation of India (NPCIL), Rs 102 crore from Uranium Corporation of India (UCIL), Rs 503 crore from Hindustan Aeronautics Limited (HAL) and Rs 23 crore from Mishra Dhatu Nigam Limited (MIDHANI) as dividend tranche, DIPAM secretary tweeted on Friday.

An official said that the dividend target for the next fiscal year is achievable as the CPSEs have a healthy profitability outlook for the upcoming fiscal. and in the last two years (2021-22 & 2022-23), they reported their highest profits.

“The disinvestment target looks pragmatic and within range if the projects in the pipeline are realised,” he added.

The disinvestment receipts and dividends from CPSEs are monitored by DIPAM. Collectively, the RE for FY23 for these receipts were set at Rs 93,000 crore, which has now been revised to Rs 94,282 crore. This is the highest achieved in the last four fiscal years. 

Business Standard had earlier reported that the DIPAM had suggested that dividends from PSEs be accounted as divestment collection, because both were revenue resources for the government.

Dividends from PSEs (which is part of non-tax revenue) and disinvestment (which is part of miscellaneous capital receipts) are the two separate revenue-generating responsibilities of DIPAM.

The minister of state in the ministry of finance, Bhagwat Kishanrao Karad, in a reply in Rajya Sabha said disinvestment is an ongoing process, and execution/completion of specific transactions hinges upon market conditions, domestic and global economic outlook, geopolitical factors, investor interest and administrative feasibility.