Finance Minister P Chidambaram today met chiefs of cash-rich Public Service Undertakings (PSU) to discuss their capital expenditure plans and the dividend payouts to the government, reports CNBC-TV18’s Aakansha Sethi.
Also read: Govt to overhaul PSU's performance related pay system: SrcsPSUs are slated to invest about Rs 1.4 lakh crore as capex in this fiscal. The target for the first half of the fiscal is about Rs 50,000 crore and sources in the Finance Ministry say that of this, about 96 percent has already been invested. So, PSU capex targets are on track.
Now, why this is being seen as good news is because a slowdown was actually seen in capex by PSUs last year and now, the Finance Ministry is seeing this as a signal of uptick in growth.
As far as dividend payouts are concerned, the FM did say that these are likely to be higher than the last fiscal. PSUs themselves said that these will be in line with dividend payouts last year. This number will be important in order to meet the 4.8 percent fiscal deficit target.
As far as the surplus cash of PSUs is concerned, the Finance Ministry has been considering asking PSUs like Minerals and Metals Trading Corporation (MMTC), Coal India for a special dividend or a buyback.
That decision has not been taken as yet and will be taken later in January once capex for the year has been committed.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
