Understanding Budget Divestment & Targets: What It Means for Public Sector Undertakings 💼

The liquidation or selling of stakes of a Public Sector Undertaking (PSU) by the government is known as divestment. Divestment was brought in along with the transformative economic liberalisation by then Finance minister Manmohan Singh in 1990. A divestment ministry was set up by the late Atal Bihari Vajpayee in 2001, and was subsequentyl rebranded in 2016 by the late Arun Jaitley to DIPAM (Department of Investment and Public Asset Management). DIPAM sets a target for PSU liquidation known as divestment target. The most recent target for divestment was set ar Rs 2.14 lakh crore, of which only Rs 11,00 crore was achieved.