PSU share sales coming up: Govt to sell stakes in these 2 sectors as non tax revenue falters

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Published: July 15, 2020 11:06 AM

With tax revenues remaining below estimates, the government is now eyeing ways to hike non-tax revenues via the sale of its stakes in PSUs or state-owned companies.

Narendra Modi, Narendra Modi at UN, ECOSOC, UN ECOSOC, Security Council,Antonio Guterres, UN Secretary-General,latest news on narendra modiThe PMO also held two rounds of meetings with top NITI Aayog officials last week on the state of the economy and to review progress with regard to sustainable development goals.

With tax revenues remaining below estimates, the government is now eyeing ways to hike non-tax revenues via the sale of its stakes in PSUs or state-owned companies. The offer for sale (OFS) route is being seen as the quickest way to raise funds by offloading government stakes at least in those companies where valuations are supportive The Indian Express cited sources as saying. Companies in the agriculture and chemicals sector are being prepared for stake sales. Sales are also being planned through OFS in MIDHANI and Garden Reach Shipbuilders & Engineers Ltd.

“The PMO also held two rounds of meetings with top NITI Aayog officials last week on the state of the economy and to review progress with regard to sustainable development goals. There is focus on both short-term and medium-term aspects of the economy and the kind of interventions that will be required,” the newspaper cited a senior government official. Further, the PM’s office has also taken a series of meetings since last week as the government looks to revive the economy. PMO is also going to undertake meetings with top Finance Ministry officials this week. The economy contracted steeply in the April-June quarter and the government is now trying to assess its revenue position. It is also mulling on ways to augment the economy and support economic activity.

Days after the coronavirus hit Indian shores, the government imposed a nationwide lockdown which had a severe impact on the economy. The GDP is expected to contract by more than 5% this year, according to various rating agencies. While easing of lockdown restrictions pushed economic activity, the same are likely to plateau again with fresh state-level curbs. Meanwhile, the center is also mulling on another round of economic stimulus. “The PM would want to assess whether another round of stimulus measures will be needed if the pickup in economic activity does not sustain, and how to fund it,” another official said.

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