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The one shot in the arm that the Indian government desperately needs is the kick-starting of the disinvestment process to raise capital to bridge its financial gaps. In her Budget speech on February 1, finance minister Nirmala Sitharaman revised the government’s disinvestment target to Rs 1.75 lakh crore for the coming financial year, compared to the ambitious target of Rs 2.10 lakh crore it had set for itself in FY21.
While the target is now lower, accomplishing it would be one of the key objectives of the government in the coming year. A disinvestment programme is one in which the government sells its stake in its assets to a third party to raise capital. The process has a direct impact on the government’s financial health, as the money is used to bridge the widening fiscal deficit of the country. Fiscal deficit is the difference between the government’s earnings and expenditures; if the government is spending more than what it is earning, then it
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