DoD formulates policy for share buyback by cash-rich PSUs

NEW DELHI: The department of disinvestment (DoD) has formulated a policy for buyback of shares by cash rich PSUs, Parliament was informed today.

"Proposal for enabling DoD to respond to the decision of a listed CPSE having surplus cash to buyback their shares has been formulated for seeking government approval," Minister of State for Finance S S Palanimanickam said in a written reply to the Lok Sabha.

The buyback decision, he said, would be taken by the boards of the concerned central public sector enterprises (CPSEs).

The government has set a mammoth target of raising Rs 40,000 crore through disinvestment this fiscal. But with eight months of the fiscal already over, it has been able to mop up only Rs 1,145 crore.

The government already has approval for disinvestment of 5 per cent disinvestment in ONGC and BHEL each and 10 per cent in NBCC. It has also identified RINL, SAIL, Hindustan Aeronautics and Hindustan Copper for possible stake sale.

"For enhancing the list the DoD is in dialogue with the Administrative Departments of other CPSEs," Palanimanickam said.

In a separate reply to the Lok Sabha, Meena said the government's fiscal deficit during the first five months of the current fiscal is estimated at 3.1 per cent of GDP.

The government has already raised the market borrowing programme for the current fiscal by Rs 52,872 crore to Rs 2.20 lakh crore in view of lower than expected inflows into the small savings schemes.