Why Nirmala Sitharaman forced to drastically reduce disinvestment target?
Currently the government is facing continuous disappointment on the disinvestment front. The government, which has been continuously failing to achieve the disinvestment target for the last few years, is again on the path of failure this time. This is the reason why Finance minister Nirmala Sitharaman has been forced to drastically reduce the disinvestment target in the latest budget. Finance minister Nirmala Sitharaman presented the interim budget yesterday on 1 February. This was the last budget of the second term of the Modi government and the sixth consecutive budget of Nirmala Sitharaman. Even though people had high expectations from the budget due to the lok sabha elections this year, this budget of the central government was realistic rather than being populist.
Meanwhile in the budget, the government reduced the target of disinvestment during the current financial year to Rs 30 thousand crore. Earlier, a target was set to raise Rs 51 thousand crore from disinvestment during the current financial year. This means that the government has reduced the disinvestment target by more than 41 percent in this financial year. The government has set a disinvestment target of Rs 50 thousand crore for the next financial year i.e. april 2024 to march 2025.
Only two months are left in the current financial year and it is ending on 31 march 2024. After the privatization of air india and NINL, the government has not achieved anything concrete on the disinvestment front. In the current financial year, the government has so far been able to collect only Rs 10,051.73 crore from disinvestment. Most of this has come through the share market route i.e. IPO/FPO. In such a situation, it seems difficult to achieve the revised target of Rs 30 thousand crores. It seems that the government is going to miss the disinvestment target for the fifth consecutive year.