Disinvestment proceeds may help revive PSUs

The government is likely to revert to the policy of using 25% of the disinvestment proceeds for reviving sick public sector units (PSUs) and recapitalising the profitable ones from the next fiscal year.

The government is likely to revert to the policy of using 25% of the disinvestment proceeds for reviving sick public sector units (PSUs) and recapitalising the profitable ones from the next fiscal year.

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The government's three-year policy of using funds from disinvestment for social sector programmes ends on March 31.

The earlier policy of the government was to utilise 75% of the disinvestment proceeds for social sector programmes and the rest for revival of sick units.

However, in view of the global financial crisis of 2008, the government changed the policy and decided to use the entire proceeds from this route for funding social sector schemes for three years (2009-10 to 2011-12).

The government raised Rs 22,145 crore through disinvestment in 2010-11. It has raised Rs 1,145 crore so far this fiscal year.