The government could mop up over Rs 3.81 lakh crore through selling its stake in the listed and unlisted state-runs firms over next the five years, the 13th Finance Commission (TFC) said today.
In its report tabled in Parliament today, the Commission wanted the government to channelise the proceedings directly into the Consolidated Fund of India so that it could also be used for funding infrastructure and environment projects instead of current practice of using it for social service.
"In the aggregate, an approximate amount of Rs 3,81,000 crore (Rs 24,000 crore from unlisted PSUs, Rs 3,41,000 crore from listed ones, and Rs 17,000 crore from listed banks) could become available to the government," the Commission report said.
It further said, assuming that this is pursued over five years, till 2010-15, this would provide resources to the tune of around 0.88 per cent of the GDP every year on an average.
"The policy regarding use of proceeds from disinvestment should be liberalised to include capital expenditure on critical infrastructure and the environment, in addition to capital expenditure on the social sectors," the report added.
The amount is almost equivalent to the Government's borrowings need for the current fiscal.
More From This Section
The government has announced net borrowing of Rs 4 lakh crore to fund the fiscal deficit during 2009-10, which stood at 6.8 per cent of the GDP.
The 13th Finance panel further said assuming divestment of unlisted PSUs from the present holding of 96.79 per cent to 90 per cent-- which is mandatory under listing rules--, an amount of around Rs 24,000 crore would be unlocked.
"Also, listing of these enterprises would enhance their quality of corporate governance," the Commission pointed out.
It further said divestment from the present holding of 84.73 per cent to 51 per cent could imply additional resources of around Rs 3.41 lakh crore for the listed companies.
Similarly, for banks, it said bringing down the Centre's share from the existing 60 per cent to 51 per cent would entail the resource availability of around Rs 17,000 crore.