As per the information given in the Parliament, the Central Government has given ‘in-principle’ approval for strategic disinvestment of 33 Central Public Sector Enterprises (CPSEs) including subsidiaries, Units and Joint Ventures with sale of majority stake of Government of India and transfer of management control.
These include profit making as well as loss making CPSEs. Government follows a policy of strategic disinvestment of CPSEs, which are not in ‘priority sectors’ For this purpose, NITI Aayog has been mandated to identify such CPSEs based on the criteria of (i) National Security; (ii) Sovereign function at arm’s length, and (iii) Market Imperfections and Public Purpose. However, profitability/loss of the CPSEs is not among the relevant criteria.
The details of disinvestment targets set by the Ministry of Finance and achieved results each year over the last five years are as follows:
(in Rs. Crore)
| Year | Budget Estimate | Revised Estimate | Actual Realisation |
| 2014-15 | 43,425 | 26,353 | 24,349 |
| 2015-16 | 69,500 | 25,313 | 23,997 |
| 2016-17 | 56,500 | 40,500 | 46,247 |
| 2017-18 | 72,500 | 1,00,000 | 1,00,057 |
| 2018-19 | 80,000 | 80,000 | 84,972 |
Strategic disinvestment of CPSEs is being guided by the basic economic principle that Government should discontinue in sectors, where competitive markets have come of age and economic potential of such entities may be better discovered in the hands of strategic investor due to various factors such as infusion of capital, technological upgradation and efficient management practices. The success of the transaction depends on the prevailing market conditions and the investors’ interest.
