Lok Sabha Question No. 3123 (UNSTARRED), answered on 2021-03-15
Subject: Disinvestment Targets
Ministry: FINANCE
Asked by: Ravneet Singh, Kumbakudi Sudhakaran

## GOVERNMENT OF INDIA MINISTRY OF FINANCE

## DEPARTMENT OF INVESTMENT AND PUBLIC ASSET MANAGEMENT

## LOK SABHA

## UNSTARRED QUESTION NO. 3123

TO BE ANSWERED ON MONDAY, MARCH 15, 2021 PHALGUNA 24, 1942 (SAKA)

## Disinvestment Targets

## 3123. SHRI RAVNEET SINGH BITTU:

## SHRI KUMBAKUDI SUDHAKARAN:

Will the Minister of FINANCE be pleased to state:

- (a) the  details  of  disinvestment  targets  set  in  the  last  five  financial  years  by  the  Government including the disinvestment target for 2020-21;
- (b) whether the Government has been able to meet its disinvestment targets or there has been shortfall in this regard and if so, the details thereof;
- (c) the details of the reasons, if any, due to which the Government has repeatedly failed to meet its disinvestment targets during the last few years;
- (d) whether  the  budgeted  disinvestment  target  for2021  will  be  met  as  per  the  Government assessment  and  if  so,  the  details  thereof  and  if  not,  the  reasons  thereforalong  with  the proportion of disinvestment target for2020-21 which has been achieved on January 15, 2021 in terms of percentage;
- (e) whether the receipts from disinvestment as a proportion of the total budget have declined since  2014  and  if  so,  the  reasons  therefor  along  with  the  total  disinvestment  receipts  as  a proportion of total receipts for each financial year since 2014; and
- (f) whether any steps are being taken by the Government to rationalize its disinvestment targets in amore calibrated manner based on realistic assessment of the economic situation and the need for new job creation as well as welfare of the existing employees in these entities and if so, the details thereof and if not, the reasons therefor?

## ANSWER

## THE MINISTER OF STATE IN THE MINISTRY OF FINANCE (SHRI ANURAG SINGH THAKUR)

(a) to (c): The disinvestment targets and actual receipts during the period 2014-15 to 2020-21 are given as under:

(Rs. in crore)

| Year                      |   Revised Estimates (RE) |   Disinvestment Receipts |
|---------------------------|--------------------------|--------------------------|
| 2014-15                   |                    26353 |                    24349 |
| 2015-16                   |                    25314 |                    23997 |
| 2016-17                   |                    45500 |                    46247 |
| 2017-18                   |                   100000 |                   100057 |
| 2018-19                   |                    80000 |                    84972 |
| 2019-20                   |                    65000 |                    50299 |
| 2020-21 (till 09.03.2021) |                    32000 |                    21303 |

Disinvestment receipts exceeded the target during 2016-17, 2017-18 and 2018-19, while falling short  in  2014-15  and  2019-20.    Disinvestment  of  GOI  equity  in  CPSEs  depends  largely  on market sentiment, investor interest, and market valuation of CPSE stocks. Over a period of time, the scope of minority stake sale has declined and strategic disinvestment & privatization would be the primary mode for disinvestment receipts.

(d): The revised estimate (RE) for disinvestment receipt in 2020-21 is Rs 32,000 crore, against the  budget  estimate  (BE)  of  Rs  2,10,000  crore  (of  which  Rs.  90,000  crore  was  envisaged  for disinvestment  in  financial  institutions,  and  Rs  1,20,000  crore  was  estimated  as  receipts  from disinvestment in CPSEs).

The  volatile  market  conditions  arising  due  to  COVID-19  adversely  impacted  Government's plans for disinvestment. The covid-19 pandemic and contraction in manufacturing and services post lockdown coupled with uncertainty in financial markets, posed significant challenges before the  disinvestment  efforts  of  the  government,  and  delayed  transactions  both  for  minority  stake sale and strategic disinvestment during large part of FY 2020-21. With the recovery of the stock market subsequently, the disinvestment transactions are coming back on track.

As on 09.03.2021, Government has realized disinvestment receipt of Rs. 21,303 crore which is around 67% of Revised Estimate (RE) in 2020-21.

- (e) The  details  of  disinvestment  receipts  as  a  proportion  of  total  receipts  (revenue  and  capital receipts),  and  disinvestment  receipts as proportion of  Budget Estimate (BE) for each financial year since 2014-15 are given as follows:

(Rs. In crores)

| Year    |   Disinvestment Receipts |   Total Receipts (revenue+capital) | Budget Estimates (BE)   | Receipts as% of total receipts   | Receipts as %of BE   |
|---------|--------------------------|------------------------------------|-------------------------|----------------------------------|----------------------|
| 24349   |                  1585921 |                              43425 | 1.54%                   | 56.07%                           | 2014-15              |
| 2015-16 |                    23997 |                            1774434 | 69500                   | 1.35%                            | 34.53%               |
| 2016-17 |                    46247 |                            1984089 | 56500                   | 2.33%                            | 81.85%               |
| 2017-18 |                   100057 |                            2137882 | 72500                   | 4.68%                            | 138.01%              |
| 2018-19 |                    84972 |                            2316434 | 80000                   | 3.67%                            | 106.22%              |
| 2019-20 |                    50299 |                            2681360 | 105000                  | 1.88%                            | 47.90%               |

Disinvestment receipts as a proportion of the Budget Estimates (BE) has increased during 2014-15 to  2018-19,  before  declining  in  2019-20  reflecting  lack  of  adequate  market  interest  in  CPSE stocks.

- (f) : Disinvestment is an ongoing process and actual transactions are carried out from time to time dependingupon market sentiments and investors interest. The indicative disinvestment targets are fixed  every  year  considering  the  expected  market  valuation  of  the  CPSE,  investor  interest, administrative feasibility and overall economic conditions.

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