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Business News/ Budget / News/  Budget pegs FY23 divestment target at 65,000 cr, cuts FY22 aim to 78,000 cr
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Budget pegs FY23 divestment target at ₹65,000 cr, cuts FY22 aim to ₹78,000 cr

Divestment proceeds so far for FY22 have been at ₹12029.9 crore, coming from the offer-for-sale of NMDC and the sale of some government-owned shares of Axis Bank

More than ₹40,201.47 crore have come as dividends from various public sector enterprises this year.. Photo: iStockPremium
More than 40,201.47 crore have come as dividends from various public sector enterprises this year.. Photo: iStock

New Delhi: The government has set a target to garner 65,000 crore from divestment in the financial year 2022-23. Finance minister Nirmala Sitharaman, in the Budget, also lowered the divestment target for FY21-22 to 78,000 crore from 1.75 lakh crore, indicating that major divestment proceeds expected from Life Insurance Corporation of India's IPO and strategic divestments of BPCL and others may not come through by March 2022.

Divestment proceeds so far for FY22 have been dismal at 12029.9 crore, coming from the offer-for-sale of NMDC and the sale of some government-owned shares of Axis Bank. More than 40,201.47 crore have come as dividends from various public sector enterprises.

Tuhin Kanta Pandey, secretary of the department of investment and public asset management, had told Mint last week that divestment proceeds will not be able to hit the 1.75 lakh crore mark.

"I don't think that we will be able to reach 1.75 lakh crore target, that that looks unlikely. It would have required BPCL transaction to close, but I don't think BPCL can close by March so therefore we have to go with a lesser number. Let’s see how much we get from LIC which is a large transaction and what others we can conclude," he had said.

While he had added that LIC disinvestment was a 'major event' that the department was working on, the valuation of the assets of LIC were close to being finalised by the valuer.

The government on Monday approved Tata Steel Long Products Ltd as the strategic buyer for Neelachal Ispat Nigam Ltd (NINL) with the highest bid of 12,100 crore, which will pool into the divestment kitty but still be far lower than the revised target for FY22.

Mint reported earlier this month that divestments of Bharat Petroleum Corp. Ltd (BPCL), BEML, Pawan Hans and Shipping Corp. of India were likely to take place in the next financial year, with the marquee sale of BPCL expected to get 50,000-60,000 crore.

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ABOUT THE AUTHOR
Gulveen Aulakh
Gulveen covers both corporate and economy, and policy sections of Mint. She also covers telecom, IT from the corporate side and disinvestment, finance ministry from the economy side. Gulveen finds the rare mix of sectors she covers to be incredibly interesting.
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Published: 01 Feb 2022, 01:56 PM IST
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