Why in news
- The Central government achieved 78% of its ₹80,000-crore disinvestment and asset monetisation target for FY27 in the first five months.
What is the Disinvestment Framework?
- Disinvestment involves the sale of government equity stake in Central Public Sector Enterprises (CPSEs) to raise non-debt capital receipts.
- Managed by the Department of Investment and Public Asset Management (DIPAM) under the Ministry of Finance.
Key Status and Collections
- Total capital receipts under this head reached ₹62,124 crore against the annual target of ₹80,000 crore.
- Primary contribution came from minority stake sales, including ₹31,515 crore raised through an LIC stake sale, alongside ongoing strategic disinvestment processes for IDBI Bank.
Why it matters
- Helps bridge the fiscal deficit without increasing market borrowings.
- Reduces government operational footprint in non-strategic commercial sectors while generating resources for capital expenditure.
Key terms
Strategic Disinvestment
Sale of a substantial portion of government shareholding in a CPSE along with transfer of management control.
DIPAM
Nodal department under the Ministry of Finance overseeing public asset management and capital restructuring.
Prelims facts
- Disinvestment proceeds are categorized as non-debt capital receipts under the Union Budget.
Mains discussion
- Role of disinvestment in fiscal consolidation and funding long-term physical infrastructure.
Source: Economic Times Economy
Same topic · past papers
UPSC has asked this before
These previous-year questions sit on the same topic. Open one to practise the earlier ask.
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2025 · Q10 · General Studies · 2 marks
Consider the following statements: I. Capital receipts create a liability or cause a reduction in the assets of the Government. II. Borrowings and disinvestment are capital receipts. III. Interest received on loans creates a liability of the Government. Which of the statements given above are correct?