India: Disinvestment proceeds to be used for infrastructure: FM

  • Finance Minister Nirmala Sitharaman on 3 Feb 20 said the money raised through disinvestment will be used to develop infrastructure, which will have multiplier effect on the economy and not bridging revenue deficit.
  • The government set an ambitious disinvestment target of INR2.10tr for FY21, which includes selling stake in BPCL and insurance behemoth Life Insurance Corporation of India (LIC).
  • “We are showing clearly where each monies being raised will go. So, it’s not being raised to fill certain hole in the Consolidated Fund of India. The money being raised from disinvestment will go towards infrastructure.”
  • On criticism of the government selling family silver through disinvestment, she said the money is not going to bridge revenue deficit but will be used for creating infrastructure which can have a multiplier effect on the economy.
  • Recalling the past experience of government fiscal expansion during the global economic crisis, the Finance Minister said the government has learnt from the past experience and decided not to go on the splurge to boost economy.

External Link :