Budget 2018: Govt mops up Rs 1 lakh crore this fiscal, targets Rs 80,000 crore from disinvestment

With privatisation of Air India Ltd on track apart from approval for listing of 14 CPSEs and strategic disinvestment of 24 CPSEs, Jaitley has set a disinvestment target of Rs 80,000 crore for 2018-19.

The disinvestment of central public sector enterprises (CPSEs) surprisingly turned out to be a key highlight of the budget.

Finance minister Arun Jaitley addresses a post budget press conference at National Media Center in New Delhi, on Thursday. (Mohd Zakir/HT)

Jaitley said the newly reva-mped Department of Investment and Public Asset Management is set to overshoot the ambitious Rs72,500 crore disinvestment target for 2017-18 by aiming to garner Rs1 lakh crore during the year ending 31 March, aided by completion of the acquisition of Hindustan Petroleum Corp. Ltd by Oil and Natural Gas Corp. Ltd for around Rs37,000 crore.

With privatisation of Air India Ltd on track apart from approval for listing of 14 CPSEs and strategic disinvestment of 24 CPSEs, Jaitley has set a disinvestment target of Rs80,000 crore for 2018-19.

After successfully launching the exchange traded fund (ETF) Bharat-22 to raise Rs14,500 crore in 2017-18, Jaitley said DIPAM will come up with more ETF offers including a debt ETF.

Ranen Banerjee, partner and leader at PwC India, said this is possibly the first time that a disinvestment target has been exce-eded. “A higher target has been taken for the next year too. With Air India’s divestment on the anvil and further tranches of exchange traded funds, the target looks achievable,” he added.

Vivek Gupta, partner at KPMG India, however said the long-term capital gains tax and the additional cess are dampeners for the equity market. “There is also the argument that equity demands that all incomes suffer tax. The government’s call is that this tax will not cause the market to be disturbed to the point that it will disrupt investment flows or disinvestment,” he added.