Govt can raise $16.6 Billion via divestment
Monday, 29 June 2009, 02:24 Hrs | 11 Comments
"Dilution of stake in leading public sector units alone could fetch at least 80,000 crore," the report by Associated Chambers of Commerce and Industry (Assocham) said, adding that this amount could be used to bring down the fiscal deficit burden.
To overcome the immediate deficit, the government may have to borrow 2.4 trillion crore from the market by September, it added.
Even a 10 percent dilution in public sector giants could fetch 60,000 crore and a 20 percent dilution would still leave the government in control of these units, Assocham said.
"NTPC alone could fetch 68,000 crore if the government stake is reduced from 89.5 percent to 51 percent. The four power sector giants together could give 98,000 crore," it added.
It urged the government to adhere to the Fiscal Responsibility and Budget Management (FRBM) Act, maintain a low tax regime and introduce goods and services tax (GST) by next April to narrow the deficit.
The FRBM Act was enacted in 2003 to bring in fiscal discipline, and imposes limits on fiscal and revenue deficits.
"There is no need for accepting a long-term fiscal deficit and deviation from FRBM goals," Assocham added.