The Union Cabinet is likely at its meeting on Thursday to take up proposals for strategic sales in a number of state-owned companies. While most of these are loss-making, some are said to be profitable.

The Cabinet could grant in-principle approval to NITIAayog’s proposal for strategic disinvestment in 20-odd central public sector enterprises, this newspaper has learnt.                                           

Two lists are said to have been prepared by the Aayog. One on companies where government ownership will be given up and shareholding will be brought to below 50 per cent in one go. And, the other on companies in which shareholding will be brought down to 51 per cent or above.

 

According to senior government sources, the companies or units for which approvals could be sought include Pawan Hans, Bridge and Roof Co, BEML, Scooters India, Hindustan Prefab and Central Electronics. Approvals could also be sought for selling some units of Steel Authority of India and NMDC.

Based on the Aayog’s suggestions, the department of investment and public asset management (Dipam) is said to have finalised methods to value and sell some of these companies. Dipam is said to be considering at least five different methods, including relative peer review and discounted cash flow, for valuation of these public sector units (PSUs).

The government's disinvestment target for the financial year (it ends on March 31) is Rs 56,500 crore. Of this, Rs 36,000 crore is expected from minority stake sales and buybacks. The rest is expected from 'strategic sales' in loss-making or profit-making PSUs or their assets (factories, warehouses, office buildings, etc).

The government has managed Rs 21,000 crore through stake sales and buybacks in the first six months, the highest-ever first half divestment revenue for any year by a good margin, raising expectations for the rest of 2016-17. Of this, Rs 16,500 crore is from buybacks initiated by five PSUs. The rest is from five stake sales through the offer-for-sale route.

Budget date
 

Additionally, the Cabinet is to take a call on on the finance ministry's proposal of advancing the date for Budget presentation to February 1 or January 31.

In September, it had in-principle decided to end the colonial-era tradition of presenting the Union Budget on the last day of February, advancing this to help complete the legislative process for approval of annual spending plans and tax proposals before a new financial year begins on April 1.

Having decided on this, the government then took the line that it should not be presented in the midst of the assembly polls due in Uttar Pradesh, Punjab, Uttarakhand, Goa and Manipur. The finance ministry held informal consultation with the Election Commission, which concurred with the ministry's view that the Budget is an annual financial statement and can come anytime the government decides; it would not be in violation of the poll code of conduct.

J&K 
 

The Cabinet is also expected to discuss an agriculture ministry proposal for a Rs 500-crore package for restoration of damaged horticultural farms in Jammu & Kashmir. These were damaged in the floods at the time. The package, of two years, will be allocated through a one-time relaxation in the cost and guidelines of the Mission for Integrated Development of Horticulture, goes the proposal.

Sugar
 

Government is likely to extend stock limits on sugar traders till end-April, to check the sweetener's prices, presently around Rs 40 ar kg. The food ministry's proposal on this issue is expected to be approved.

Early this year, the government had reimposed stock limits on sugar traders after a gap of five years, due to a rise in sugar prices following a drop in domestic production.

DA
 

In what would bring cheer to five million central government employees and 5.8 mn pensioners, the Centre is also set to announce a two per cent dearness allowance (DA), effective from July 1, 2016. This is provided to neutralise the impact of price rise on their earnings.