Power PSUs to face dividend demand

The government today identified state-owned companies in the power sector as a source for generating resources through interim dividends. This is to partly make up for the shortfall on account of a lower pay-out by the Reserve Bank of India (RBI).

"The RBI's transfer of surplus profit will be lower by Rs 3,000 crore, resulting in a shortfall in the government's dividend receipts for the current fiscal. This is unlikely to be made up," a finance ministry official said.

The Centre had hoped to earn a sizeable amount through interim dividends but the power companies have not complied with the government directive so far.

The decision was taken at a meeting of financial advisers attached to various ministries with Finance Minister P Chidambaram. The minister also took stock of the expenditure position in the health, rural development and education departments.

The boards of oil companies like Oil and Natural Gas Corporation and Indian Oil Corporation and other public sector companies like BHEL, Bharat Sanchar Nigam Ltd have already cleared proposals for interim dividend. So far, the government has mopped up around Rs 2,800 crore through interim dividends, which is close to last year's level.

The Centre's interim dividend collections were expected to improve by the end of the month, as some of the payments made by the companies had not been entered in the government's books.

The government had budgeted for Rs 18,875 crore in dividend receipts during the current fiscal year.

Of this, Rs 12,978 crore was to come from public sector companies and the rest from the surplus profit of the central bank, nationalised banks and financial institutions.