The Centre will likely achieve the fiscal deficit target of 5.9% of the GDP in the current financial year, minister of state (MoS) for finance Bhagwat Karad told the Lok Sabha on Monday.
The government’s fiscal deficit was at 45% of the budget estimate (BE) in the first seven months of the current financial year, aided by robust tax and non-tax receipts. However, disinvestment receipts are lagging behind the target.
When asked if the shortfall in disinvestment receipts would impact fiscal deficit in FY24, Karad said that fiscal deficit depends on many factors, such as total expenditure, total non-debt receipts, GDP, etc.
“Tax and non-tax receipts constitute a major proportion of the government’s total non-debt receipts. The government is likely to achieve the fiscal deficit target of 5.9% in the current financial year 2023-24,” he said.
So far in the current fiscal, the government has raised about Rupees 10,050 crore through disinvestment in various Central Public Sector Enterprises (CPSEs), which is 20.6% of the Rupees 51,000 crore target.
Karad said the budget estimate for disinvestment receipts in the current FY 2023-24 was fixed based on the probability of completion of the transactions. “However, disinvestment is an ongoing process and the execution of disinvestment transactions depends upon administrative feasibility, market conditions, domestic and global economic outlook and investor interest,” he said.
“In view of this, it is difficult to anticipate the quantum of actual proceeds from disinvestment during the current FY23-24,” Karad said.
The government, since 2016, has given ‘in-principle’ approval for strategic disinvestment of 36 cases of PSEs and/or subsidiaries of CPSEs/banks.
Out of the 36 cases, 33 are being handled by DIPAM (Department of Investment and Public Asset Management) and three are being handled by the respective administrative ministry or department.
Out of the 33 cases being handled by DIPAM, strategic disinvestment transactions have been completed in 10 cases, eight transactions are in CPSE to CPSE space, while Air India and NINL have been privatised.
Of the remaining 23 cases, five PSEs are under consideration for closure, one case held up due to litigation, one is under Corporate Insolvency Resolution Process (CIRP) in NCLT and two transactions have been found not feasible. The remaining 14 transactions are at various stages, the minister said.