Divestment funds may be directed to flagship plans

The money that the Central government intends to raise from disinvestments of the public sector undertakings (PSUs) is likely to be used to fund the UPA-2's flagship programmes., reports Chetan Chauhan.

Updated on: Oct 8, 2009, 01:40:17 IST

Hindustan Times | By Chetan Chauhan, New Delhi

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The money that the Central government intends to raise from disinvestments of the public sector undertakings (PSUs) is likely to be used to fund the UPA-2's flagship programmes.

The Union Cabinet on Thursday is expected to consider a proposal made by the finance ministry seeking a one-time waiver of the ban (till March 2012) on spending money from PSUs disinvestments on the social sector schemes.

If approved, this would mean that the money raised through disinvestments -- for which 15 PSUs are already listed-- could be used to manage fiscal deficit. The government has set a target to reduce the fiscal deficit to 5.5 per cent in 2010-11 and 4 per cent in 2011-12 from an estimated level of 6.8 per cent in 2009-10.

In January 2005, the Cabinet had decided to park the money raised from disinvestments in the National Investment Fund (NIF), which is not part of the budget. The Rs 18,000 crore (Rs 180 billion) in the fund cannot be used for any programmes listed in the budget.

This was done after the NDA government (in power till 2004) was criticised for selling shares of PSUs to manage fiscal deficit.

With the government earning from taxes going down, the finance ministry has sought permission to allow money from the NIF to finance 15 programmes.

ABOUT THE AUTHOR
Chetan Chauhan
Chetan Chauhan is the National Affairs Editor looking into all aspects of news and features from across India. A Chevening scholar with over three decades of experience in reporting and news management, Chetan has extensively covered all important aspects of the social sector, political economy, environment and climate change nationally and internationally. He did a journalism course at the Reuters Institute of Journalism in Oxford and Digital Media training at Nanyang Technological University in Singapore. He started as a reporter with The Statesman in 1996 and joined the Hindustan Times in 2000 in the metro bureau covering environment, crime and Delhi politics. He covered hot local news, from the Jessica Lal murder case to the rebellion of Delhi Congress MLAs against then Chief Minister Sheila Dikshit, to the replacement of toxic vehicle fuel with cleaner compressed natural gas (CNG) in the national capital. Some of his stories on air pollution became part of the Supreme Court’s landmark MC Mehta versus Government of India case in the National Capital Region (NCR), forcing the government to take corrective measures. As part of the national political bureau since 2004, he covered important central sectors such as environment, education, social justice, labour, rural development, water resources, renewable energy, agriculture, broadcasting and the Planning Commission for more than a decade producing several exclusive and investigative breaking stories. His specialisation is the environment, having covered at least a dozen United Nations global conferences on climate change, biodiversity and wildlife including climate summits in Paris, Copenhagen and Bali. He also covered India’s two five-year plans ---11th and 12th and reported on drafting and execution of right based laws such as Right to Education, Right to Information and rural job guarantee law, MG-NREGA, now being introduced in new format as VG-RAM-G Act. He has in-depth knowledge of social sector issues. He was one of the first to report on tigers vanishing from Sariska and Panna wildlife reserves in 2004 and 2008, respectively, leading to the setting up of the National Tiger Conservation Authority (NTCA) and the introduction of stringent penal provisions for poaching. He has written extensively on the rising human-animal conflict in India and the degradation of India’s biodiversity hotspots because of mining and other activities. Since 2004, Chetan has covered Parliament comprehensively and participated in training on the nuanced coverage of Parliament proceedings. He has travelled extensively across India to cover national and provincial elections since 1998, especially in the Hindi heartland states, considered India’s road to power. He writes a regular column for Hindustan Times, Ecostani, on important national politics, economy, Himalayan ecology and environmental issues. His other responsibilities include providing inputs for edits and edit page articles for the publication, apart from managing news flow from across India.Read More

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