Budget Economic Survey 2019: Amitabh Kant’s two-pronged formula to fulfil Modi’s investment dreams

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July 4, 2019 1:33 PM

Economic Survey 2019-20: The government can do a lot on the investment front, and there is a vast possibility for disinvestment, Niti Aayog CEO Amitabh Kant said.

Amitabh Kant (File photo)Economic Survey 2019: Amitabh Kant says India needs to fast-track disinvestment, asset recycling to raise money

Economic Survey 2019: The government must focus on disinvestment and asset recycling to raise money in a bid to kick in the investment cycle in the country. The government can do a lot on the investment front, and there is a vast possibility for disinvestment, Niti Aayog CEO Amitabh Kant said in an interview to CNBC TV18 shortly after the Economic Survey 2019 was released on Thursday. Niti Aayog is going to recommend more PSUs for disinvestment, Amitabh Kant said. The government think tank has already recommended more than 50 government enterprises for disinvestment, he said. Narendra Modi’s ruling BJP in its election manifesto had promised an investment of Rs 100 lakh crore in next five years to build India’s infrastructure.

“Government is sitting on a lot of assets. Niti Aayog has already recommended more than 50 government enterprises for disinvestment, and the Cabinet has already approved disinvestment in 35 public sector undertakings out of 50,” Amitabh Kant said. It is important for the government to undertake disinvestment in a transparent and fair manner, and the push for strategic disinvestment and asset recycling will enable these processes to complete in a timely manner, Amitabh Kant said. However, all procedures are needed to be complied with while dealing with the government assets, which is quite a time taking process, he said while responding to the question on timeline.

PSU white elephants

“There is political and administrative will for asset monetisation, strategic divestment, asset recycling across roads, ports, Infra projects immediate investment trigger. Why should BSNL hold towers?” Amitabh Kant said. The government garnered Rs 84,972 crore from the disinvestment of government enterprises in the last financial year 2018-19. This year it has a disinvestment target of Rs 90,000 crore. Asset monetisation of CPSE’s non-core assets was on the priority list of the government. Among the major candidates for disinvestment, and PSU white elephants is national carrier Air India. The government’s plans to disinvest Air India or sell it outright has been in the works for quite some time now but has not progressed for various reasons.

It’s all about economic growth

Besides, the government also needs to give impetus to the exports as it is very critical for the economy. The government is aiming for $5 trillion-economy by 2024-2025, which requires 8 per cent GDP growth. For achieving this, India needs to spur investment and savings rates to sustain GDP growth at 8 per cent, according to Kant. 

In the context of economic policies, in terms of savings, the country needs big players to come in. Brownfield projects are required to go for bidding, Kant said. There is a need to get into sunrise areas like electric mobility. To drive exports, which is very critical for Indian economy, the country needs domestic market, size and scale. The country needs to become a global player in terms of exports.

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