Prime Minister Manmohan Singh today indicated that the full Budget for 2009-10 may announce a disinvestment of government stake in public sector companies.
"Fiscal prudence and disinvestment of public sector units — all these issues will be tackled by the Finance Minister in the Budget," Singh told reporters after the second round of swearing in of Union Ministers at Rashtrapati Bhawan.
The Prime Minister said economic growth would not come at the cost of fiscal prudence. "We would ensure economic growth momentum but at the same time fiscal prudence will be kept in mind," he said.
A host of companies waiting for the government nod for disinvestment include Bharat Sanchar Nigam Ltd (BSNL), railway consultancy firm RITES, National Aviation Company, and Ircon.
The government has already cleared the disinvestment of NHPC and Oil India but could not tap the capital market due to the prevalent negative sentiment.
Fund mobilisation by the government by way of initial public offers (IPOs) declined in 2008. There was only one PSU IPO, which was that of Rural Electrification Corporation, worth Rs 1,421 crore.
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In 2007, there were four PSU IPOs, including those of Power Grid Corporation and Power Finance Corporation, worth Rs 5,580 crore.
Finance Minister Pranab Mukherjee had yesterday said he will present the full Budget for 2009-10 in the first week of July.
Listing the concerns and constraints being faced by the economy, he had said there is no alternative to boosting growth in tandem with employment generation, for which the government is willing to increase its borrowing.
"Let me say unambiguously that we are committed to restoring growth and employment and that would not (be) possible without increased spending funded by incremental borrowing. This would need to be further continued in 2009-10. However, we are equally committed to the process of fiscal consolidation over a period of, say, 2 to 3 years," he said, exuding confidence that an early return to recent growth performance would help attain fiscal prudence.
On the stimulus package, Mukherjee had said the government is assessing the impact of three packages, announced in December, January and in the interim Budget, in boosting growth.
The government has cut excise duty by six per cent and service tax by two per cent, in addition to announcing sector-specific measures to arrest the impact of the global financial meltdown on the Indian economy.
However, the economy continued to witness a slowdown with industrial production figures in March showing a contraction of 2.3 per cent and exports falling since October.