Lack of funds can hit India’s economic growth hard. Just how hard, can be seen in the Union government’s decision to study the feasibility of selling ‘idle’ assets of the various public sector entities to fill gaps in revenue generation, a move announced in the budget.
What was not mentioned, was that the govenrment has already set up a committee for the purpose.
The panel, under the chairmanship of the secretary of economic affairs, a position currently held by Shaktikanta Das, is slated to hold its first meeting later this month. Its first task – quantifying assets, primarily land holdings, and their valuation.
The asset sale will be a part of the government’s disinvestment initiative which aims to raise over Rs 56,500 crore in 2016-17. The government fell short of its Rs 69,500-crore disinvestment target by over 50% in the previous fiscal. Leasing and selling land can give the disinvestment process a huge leg up.
Senior officials said the government will formulate guidelines under which land can be leased or sold, after which it will move the Cabinet for a formal nod.
The committee will also deliberate on what sort of new projects can be undertaken with the resources raised from the mobilisation efforts. Interestingly, the government is not aware of the land holdings under its various agencies and departments, sources said.
The committee, which includes secretaries of ports, urban development, and heavy industries among others, was quitely set up out in early February before the move to monetise idle assets was proposed in the budget.
This is not the normal process. All procedures of the budget proposals come into effect only after the budget is tabled in the Parliament. In cases where the government does take any such step, the finance minister mentions it in his budget speech.
However, finance minister Arun Jaitley’s budget speech merely said: “A new policy for management of government investment in public sector enterprises, including disinvestment and strategic sale, has been approved”.