Cabinet approves procedure and mechanism for Strategic Disinvestment

Aug 17, 2017 12:06 IST
Cabinet approves procedure and mechanism for Strategic Disinvestment

The Cabinet Committee on Economic Affairs (CCEA) has approved the proposal of the Department of Investment and public Asset Management (DIPAM) for strategic disinvestment.

The meeting was chaired by Prime Minister Narendra Modi. The approval will help in the speedy completion of strategic disinvestment transactions.

Key Highlights

• The department would be setting up an alternative mechanism comprising Finance Minister, Minister for Road Transport and Highways and Minister of Administrative Department.

• The alternate mechanism would be given the charge of deciding on matters relating to terms and conditions of the sale from the stage of inviting of Express of Interests till inviting of financial bid.

• Besides this, CCEA will also empower the Core Group of Secretaries on Disinvestment (CGD) to take policy decisions with regard to procedural issues.

• The Core Group will also be allowed to consider deviations as necessary from time to time for effective implementation of decisions of CCEA.

CA eBook

What is strategic disinvestment?

It means when a significant proportion of a Public Sector Unit’s (PSU) share and the management control goes to a private sector strategic partner.

The move is generally undertaken to mobilize more funds however, it is also to enable better use of the resource and its more efficient allocation.

 CCEA approves proposal to speed up strategic disinvestment

About DIPAM

• It is a nodal agency of the Union Ministry of Finance that has been authorised to advise the Union Government in the matters of the financial restructuring of PSUs and also for attracting investment through capital markets.

• The main vision of the agency is to promote people’s ownership of Central Public Sector Enterprises to share in their prosperity through disinvestment.

• It also aims to efficiently manage public investment in CPSEs in order to accelerate economic development and boost Government’s resources for higher expenditure.

Is this article important for exams ? Yes4 People Agreed

DISCLAIMER: JPL and its affiliates shall have no liability for any views, thoughts and comments expressed on this article.

Latest Videos

Register to get FREE updates

    All Fields Mandatory
  • (Ex:9123456789)
  • Please Select Your Interest
  • Please specify

  • ajax-loader
  • A verifcation code has been sent to
    your mobile number

    Please enter the verification code below

This website uses cookie or similar technologies, to enhance your browsing experience and provide personalised recommendations. By continuing to use our website, you agree to our Privacy Policy and Cookie Policy. OK