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New Delhi: Beefing up his Budget proposals, finance minister Pranab Mukherjee on Tuesday promised to unveil a road map for disinvestment after consultations with stakeholders (read: key allies DMK and Trinamool Congress). And though his speech committed to a launch date of April 1, 2010 for the new goods & services tax, Mukherjee has now admitted that it may have to be launched without all states on board. To remove bottlenecks in infrastructure investment, the he has also suggested that the Prime Minister head the committee on infrastructure (CoI) to monitor project implementation.
“I know there are problems (in the smooth introduction of GST). But I am a little encouraged as I had a meeting with state finance ministers and then a meeting with the chairman of the empowered committee of state finance ministers. He assured me that it would be possible to introduce GST from next April. But like in VAT, when some states joined later, this may happen in GST, too,” Mukherjee said .
On disinvestment, the FM said: “The Budget is not the document that will set the minute aspects of the disinvestment roadmap. But we have given the basic agenda in the Budget. I didn’t mean that a roadmap would not be made or (made) public, only that the Budget document shouldn’t include it. It should come out after a good deal of deliberation with all stakeholders.”
Officials said that the government would start the process with the sale of equities in listed PSUs where public floating stock is less than 10%. “We earlier mooted the idea of a minimum 25% public float. This should be done in a phased manner for both private and public companies. Sale of equities will start with profit-making listed companies, where the public float is less than 10% and can move up to 25%. A list will be prepared,” one senior official said.
While the government is clear that there would be no strategic sale of public sector enterprises, it is keen to use the disinvestment proceeds to bridge the deficit. “At present, the disinvestment money does not come to the Consolidated Fund, but to the National Investment Fund. A proposal is in the works to change the architecture of the NIF. Now, only interest income (from the NIF corpus) can be used for social sector projects and reviving sick PSUs. A decision will have to be taken...
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