Divestment Target Set At Rs 1.05 Lakh Crore For FY20; Public Sector Banks To Be Infused With Rs 70,000 Crore Capital

The Union Finance Ministry has set an ambitious divestment target of Rs 1.05 lakh crore for Financial year 2019-20, which is an increase from the target Rs 90,000 crore in the last fiscal.

Finance Minster Nirmala Sitharaman added that the government would continue with strategic divestment of select Central Public Sector Enterprises (CPSEs). She also reiterated that the strategic-divestment of Air India would be re-initiated.

Coming to the banking sector, Sitharaman stated that Rs 70,000 crore capital would be infused into Public Sector Banks (PSBs) to boost credit lending. The number of PSBs would be brought down to eight as part of the government’s merger program.

The purchase of high-rated pooled assets of Non-Banking Financial Companies (NBFCs) by PSBs would be enabled by a one-time six-month partial credit guarantee in case of losses up to 10 per cent.