While the mega stake sale in Coal India and ONGC is still uncertain, the government appears set to miss the R52,000 crore disinvestment target, as R15,000 crore estimated from the residual stake sale in HZL and Balco is also unlikely to come this year.
The stake sale in FY15 drawing just R1,800 crore with less than two and half months remaining in the fiscal, the whole process is again one of fixing high targets in the Budget to keep the fiscal deficit low and then falling short.
The way disinvestment is tackled in the Budget for FY16, therefore, would be crucial in terms of both policy and fiscal strategy.
With Narendra Modi in favour of strengthening PSUs, the government may look at disinvestment differently and instead of going for mega stake sales, it can look at getting more dividends by improving the health of PSUs.
But given the resource requirements, disinvestment in small packets of 5% and 10% along with dilution of SUUTI, which alone can give R61,000 crore and residual stake sale in HZL Balco can help government garner additional revenue that can help boost investment.
The total disinvestment money in FY15 Budget is pegged at R63,425 crore including the receipts from SDRs and R6,500 crore from SUUTI, and according to the current strategy, disinvestment target for both FY16 and FY17 being looked at is R55,000 crore.