Disinvestment target may be revised in November

The Department of Disinvestment may reset the target of raising Rs 40,000 crore from disinvestment in 2011-12, in November, after a mid-term review of the budgetary exercises for revised targets of the year.

The Department of Disinvestment may reset the target of raising Rs 40,000 crore from disinvestment in 2011-12, in November, after a mid-term review of the budgetary exercises for revised targets of the year.

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"There will be revised budgetary exercise. We will look into revised estimates for 2011-12 ... and at that point of time we will probably take a call," disinvestment secretary Haleem Khan said on Saturday when asked about realistic disinvestment target for the current fiscal.

"Revised targets are initiated sometime in November," he told reporters on the sidelines of a seminar organised by Indian Chamber of Commerce organised on 12th Plan.

After the revised budgetary targets are set, the Department of Disinvestment will take a call on how aggressively they will pursue the government stake sale during the year, Khan said.

"The government has both long and short term objectives from disinvestment. The short term objective is to meet the resource gap and the gap was initially identified at Rs 40,000 crore for the year," he said.

So far, the government has been able to raise less than 3% of the initial target of Rs 40,000 crore for the year due to sluggish market conditions.

In 2010-11, the initial budgetary target from disinvestment was Rs 40,000, but it was later revised to Rs 22,000 crore.

Khan said the long-term objective of the government is to continue with the existing policy of divestment of up to 49% of the profit making PSU companies and those who have the capability to compete in the market.

For continuous loss making firms which the government is not able to turnaround, a strategic sale would be taken up, he said.

"However, we will continue to prepare ground for companies which have been cleared for disinvestment by the government," Khan added.