Key Initiatives in the last three years of Department of
Investment and Public Asset Management (DIPAM)
·
Total
disinvestment achieved in the last three years (2014-15 to 2016-2017) was Rs.
87,714 crore as against Rs. 53,670 crore in the previous three-year period;
·
A
system of Rolling Plan has been brought-in to take advantage of the market
conditions without any loss of time and with an element of surprise for the
market players among others.
With a vision to
promote people’s ownership of the Central Public Sector Enterprises (CPSEs) and
a share in their prosperity through disinvestment, and efficient management of
public investment in CPSEs for accelerating economic development and augmenting
Government’s resources for higher expenditure, the Department of Investment and Public Asset Management (DIPAM),
Ministry of Finance, has been working tirelessly to achieve these goals.
Figure 1: Areas of
Achievements of DIPAM in the past three years
The major achievements of DIPAM in
the past three years are outlined below.
1) Disinvestment
Performance
The total disinvestment achieved in
the last three years (2014-15 to 2016-2017) was Rs. 87,714 crore as against Rs.
53,670 crore in the previous three-year period. The average yearly realization
of Rs. 29,238 crores during the period between 2014-15 to 2016-17 (last 3
years) vis-à-vis Rs. 19,873 crore for the period between 2009-10 to 2013-14 (5
years) represents an increase of 47%.
Figure 2: Disinvestment achieved (Rs
crore)
(Figures for 2016-17 are till end
February, 2017)
2) Accelerating the
Disinvestment Process
A system of Rolling
Plan has been brought-in, replacing the earlier system of annual
plans, wherein shares are readily available for transactions, to take advantage of the market conditions
without any loss of time and with an element of surprise for the market
players. This helps in minimizing the price hammering during disinvestment of
CPSEs.
Figure 3: Accelerating the
disinvestment process
Based on the
suggestion made by DIPAM, the Securities and Exchange Board of India (SEBI)
through its circular dated 15th February, 2016 has reduced
the notice period for an Offer for Sale (OFS) transaction from T-2 to T-1 (T
being the transaction day). This change is now helping in minimizing price
hammering between the notice day and the transaction day, which used to take
place earlier under the T-2 dispensation.
The Government is evolving an Equity Culture and has made the
CPSEs’ disinvestment programme more inclusive by following an approach to
reserve 20 per cent of shares in CPSEs-OFS transactions for retail investors on
a case to case basis.
3) Central Public Sector Enterprises
(CPSE) Exchange Traded Fund (ETF)
The CPSE ETF allows
the Government of India to simultaneously
divest multiple stocks spread across various sectors in one bundled instrument,
thereby reducing overhang on individual stocks and maximizing the sale proceeds
for the Government.
The
Government launched a Further Fund Offer (FFO) of the CPSE ETF Scheme. Overall, the issue
got oversubscribed by 2.30 times – Rs. 13,802 crore worth of applications were
received as against the maximum issue size of Rs. 6,000 crore. The number of
Retail applications was 2,70,712 (approx. 7 times the Retail applications
received during first tranche held in March 2014), with corresponding value of
Rs. 2,465 crore. This was one of the largest retail offering (Government /
Private) in capital market in last few years. The Government realized an amount to
the tune of Rs. 6000 crore through this offer.
4) Strategic Disinvestment
As a part of the initiative to
fast-track strategic disinvestment of CPSEs, the Core Group of Secretaries on
Disinvestment (CGD) was constituted on 21st March, 2016. Based on the
report of the NITI Aayog and the recommendations of CGD, the Cabinet Committee
on Economic Affairs (CCEA) in its meeting held on 27th October,
2016, has approved, ‘in-principle’ the proposal for strategic disinvestment of
some CPSEs, units of CPSEs and subsidiaries of CPSEs.
For the purpose of uniformity and
efficient implementation of strategic disinvestment transactions, the 'flow
of activities' to be completed within a specified time in respect of
disinvestment of Government equity as well as disinvestment of equity of parent
CPSE, subsidiary and sale of units of CPSEs has been prepared and communicated
to the concerned Administrative Ministries/Departments for completion of the
activities within the specified timeline.
The objective of
strategic disinvestment includes the Government exiting from non-strategic
business, unlocking optimum economic potential by promoting efficiency &
professional management in such companies.
5) Promotion of payments through
cards and digital means
To promote digital
payments, BHIM application has been launched that facilitates digital payment
transactions through UPI and USSD modes. The acceptance infrastructure is being ramped up through procurement of
Aadhaar ready PoS machines. Further, alternative acceptance options
through QR code have also been developed.
A number of
incentives have been provided to encourage digital payments amongst merchants
and consumers. Capacity building
and awareness campaigns have been launched by various Departments and State
Governments to promote digital payments. The Business Correspondents
network is being expanded through
inclusion of Fair Price Shops and Post Offices to provide digital transaction
options at various geographically convenient locations. Seeding of
Aadhaar and mobile numbers in the bank accounts is also underway to enable the accountholders to undertake
transactions through mobiles or Aadhaar authentications.
6) Time-bound listing of CPSEs on
Stock Exchanges
The Budget 2017-18
announced to put in place a revised mechanism and procedure to ensure time
bound listing of identified CPSEs on stock exchanges. This will enable
unlocking the true value of the company and promote ‘people’s ownership’ by
encouraging public participation in CPSEs, making them accountable to its
shareholders. DIPAM has issued circular dated 17.02.2017 on the mechanism and
procedure, along with a list of activities with indicative timelines, for time
bound listing of CPSEs by all the Administrative Ministries/Departments. Sources - PIB
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