The government plans to raise Rs 1.75 lakh crore in 2021-22 from dilution of its holding in public sector enterprises (PSE), two banks and one insurance company. The target has been revised down from the last year’s Rs 2.1 lakh crore.

Unveiling the PSE policy in Budget 2021-22, Finance Minister Nirmala Sitharaman said barring four strategic areas, public sector companies in other sectors will be divested. The policy would give a clear roadmap for disinvestment in strategic and non-strategic sectors.

She said strategic sale in PSEs like IDBI Bank, BPCL, Shipping Corp, Container Corporation and Neelachal Ispat Nigam Ltd would be completed in the fiscal year beginning April 1. Legislative amendments required for listing Life Insurance Corporation (LIC) will also be brought in.

Government think tank NITI Aayog has been tasked to work on the next list of central public sector units (PSU) for strategic stake sale. Sitharaman said a revised mechanism for fast-tracking closure of loss-making PSUs would be worked out and an incentive package would be developed to incentivise states to sell stake in state PSUs. The government plans a special purpose vehicle (SPV) to monetise the land under central PSUs.

In 2020-21, The government had aimed to raise Rs 1.20 lakh crore from selling stake in CPSEs and Rs 90,000 crore from financial institutions. It has so far garnered Rs 19,499 crore through minority stake sale in CPSEs and share buybacks.