As announced by the finance minister in the FY2022 budget speech, the Indian government is aiming to monetize 100 government-owned assets across sectors to mobilize about INR 2.5 trillion, which will be crucial to meet the overall revenue target. This is part of a National Asset Monetization pipeline. Excerpts from a news report in The Times of India.
Reiterating his strong backing for privatisation and asset monetisation, the PM said the reforms, which have been launched, were aimed at ensuring that public money is spent judiciously to benefit the poor, in what was seen as a response to critics of the new policy unveiled in the Budget.“The money that belongs to the poor is used for such enterprises (PSUs). This puts a huge burden on the economy,” Modi told a webinar to draw up the roadmap for the implementation of Budget proposals on privatisation and asset monetisation.
He said the government does not have to keep running public sector enterprises just because they have been running for decades or they were “pet projects of somebody”.
[…]Since coming to power in 2014, the NDA government has talked about the sale of PSUs, especially loss-making ones, such as Air India, but it has a poor track record. It sought to pass off the sale of state-run entities, such as HPCL to ONGC, another PSU, as strategic sale, drawing criticism even from the CAG.
It is now trying to push it as a key reform initiative and has even added state-run banks and a general insurance company to the list, after specifying that only four strategic sectors — atomic energy, space and defence, transport and telecom, power and petroleum — will have PSUs. Even in the sectors, state-run firms can have a diminished presence.
