dividend from PSUs that are sitting on huge cash piles. At the end of the 2012-13, CIL’s cash reserves stood at R63,236 crore, while NMDC’s was at R21,000 crore.
The finance ministry is pushing for higher dividends as some of the planned disinvesment might not fructify, even though a road map for disinvestment in the remaining days of this fiscal has been laid out. The divestments lined up include major PSUs like IOC, Engineers India (EIL), BHEL and Hindustan Aeronautics (HAL).
The finance ministry is planning to go ahead with the stake sale of IOC and EIL this month, while BHEL’s divestment is slated for February. The government also proposes to offload equity in HAL in March. Although the government had planned to raise R40,000 crore from disinvestment of PSUs, it has so far garnered only R3,000 crore from the sale of stake in seven PSUs, including Power Grid Corporation, Hindustan Copper, National Fertilisers and MMTC. Dividend and disinvestment are essential for the government to cap the fiscal deficit at the targeted level of 4.8% of GDP in FY14.