Government to privatise non-strategic PSUs, announces Finance Nirmala Nirmala Sitharaman

Union Finance Minister Nirmala Sitharaman on Sunday said a new coherent public sector enterprises policy will be formulated that will define strategic sectors which will have not more than four PSUs. List of strategic sectors requiring presence of public sector undertakings (PSUs) in public interest will be notified, she said while announcing her fifth and final economic stimulus package. 

In strategic sectors, at least one enterprise will remain in the public sector but private sector will also be allowed. In other sectors, PSUs will be privatised. "To minise wasteful administrative costs, number of enterprises in strategic sectors will ordinarily be only one to four; others will be privatised/merged/brought under holding companies," she said. 

Last week, the government pledged a Rs 20 lakh crore (nearly 10 pr cent of GDP) package to support the economy headed for its first full-year contraction in more than four decades. This included March 27 announcement of Rs 1.7 lakh crore package of free foodgrain and cash to poor for three months and the Reserve Bank of India's Rs 5.6 lakh crore worth of liquidity measures since March.

In a big push to revive the COVID-hit economy, Prime Minister Narendra Modi on Tuesday announced massive new financial incentives on top of the previously announced packages for a combined stimulus of Rs 20 lakh crore, saying the coronavirus crisis has provided India an opportunity to become self-reliant and emerge as the best in the world.

About the financial package, the prime minister said it will be around 10 percent of the GDP and "will play an important role in the Aatmanirbhar Bharat Abhiyan (self-reliant India campaign), adding that the "announcements made by the government so far, the decisions of the RBI and today's package totals to Rs 20 lakh crores".

Apart from the Reserve Bank of India (RBI) assistance, the government had last month announced a Rs 1.74 lakh crore to provide benefits to the poor, including cash transfers, Rs 50 lakh insurance cover and steps to ensure food security.