Preview

Disinvestment Policy of Indian Government & Its Impact

Powerful Essays
Open Document
Open Document
5675 Words
Grammar
Grammar
Plagiarism
Plagiarism
Writing
Writing
Score
Score
Disinvestment Policy of Indian Government & Its Impact
Disinvestment Policy of India & Its Impact

Presented by

Karishma Vora- PG12072
Purva Kashikar- PG12074
Rahul Chawla- PG12076
Priyanka Mahapadi- PG12078
Priyanka Gund- PG12080

INDEX:

TOPIC | PAGE NO | Disinvestment * Meaning * 3 Ps of disinvestment | 4-5 | PSU * Meaning | 6 | Reasons for Disinvestment * Inefficiencies * Negative Rate of Return | 7 | Objectives of Disinvestment * To reduce the financial burden on government * To improve public finances * To introduce competition and market discipline * To find growth | 8 | Importance of Disinvestment * Utilisation of funds for: * Financing the increasing fiscal deficit * Financing large-scale infrastructure development * For investing in the economy to encourage spending | 9 | Approaches of Disinvestment * Majority * Minority * Complete Privatization | 10-11 | Past Disinvestment Policy | 12-15 | Current Disinvestment Policy * Salient features of the Policy * Government approved action plan for disinvestment in profit making government companies: | 16 | Process of Disinvestment * Organizational structure * Areas under each joint secretary | 17-20 | Disinvestment Procedure | 21 | NIF * Broad investment objectives * Salient Features * Fund managers * Corpus of NIF | 22-24 | Benefits of Disinvestment * For the government * For Market and Economy * For Tax Payers * For the Employees * For the PSU’s | 25-28 | Disadvantages of Disinvestment * Concentration of Wealth * Loss of Employment * Lower Value of Realisation | 29 | Problems in Disinvestment * Social * Political * Economic | 30-31 | Recent Disinvestment Cases * Hindustan Copper Limited (HCL) * National Mineral Development Corporation (NMDC) | 32-33 | Conclusion | 34 | Bibliography | 35 |

What is Disinvestment?

At the very basic level, disinvestment can be explained as follows:

* “Investment refers to the conversion of


Bibliography: * http://businesstoday.intoday.in/story/disinvestment-receipts-fiscal-deficit-under-control/1/189233.html * http://businesstoday.intoday.in/story/budget-2012-divestment/1/23058.html * www.google.co.in * www.wikipedia.org * http://www.ndtv.com/topic/disinvestment-in-psu * www.theeconomictimes.com- article dated 20th December, 2012 * http://www.thehindubusinessline.com/industry-and-economy/economy/limiting-fiscal-deficit-to-53-of-gdp-is-challenging/article4209782.ece * www.divest.nic.in/ * The Times of India article dated 27th December, 2012
Continue Reading
View Writing Issues

You May Also Find These Documents Helpful

  • Good Essays

    Case Study 3: Property Right Security in Russian Deprivatization
    • 536 Words
    • 3 Pages

    Case Study 3: Property Right Security in Russian Deprivatization

    The impact that the prospects of deprivatization have on investment by managers of privatized firms is that these managers will come to a realization that additional investments are prone to more risks in respect to the potential payback. In this situation, the time frame for returns on investments is shortened immensely. The uncertainty stems from the longer time frame, which results in managers hesitating from entering as a private firm. If this notion of deprivatization is upholded upon organizations, the owners will potentially lose any gains they may possess.…

    • 536 Words
    • 3 Pages
    Good Essays
    Read More
  • Good Essays

    Fin 111
    • 419 Words
    • 2 Pages

    Fin 111

    FIN111 Tutorial Solution Week 2 Ross Chapter 1 Critical Thinking and concepts review Chapter 1 1. Capital budgeting (deciding on whether to expand a manufacturing plant), capital structure (deciding whether to issue new equity and use the proceeds to retire outstanding debt), and working capital management (modifying the firm’s credit collection policy with its customers). Disadvantages: unlimited liability, limited life, difficulty in transferring ownership, hard to raise capital funds. Some advantages: simpler, less regulation, the owners are also the managers, sometimes personal tax rates are better than corporate tax rates. To maximise the current market value (share price) of the equity of the firm (whether it’s publicly traded or not). In the corporate form of ownership, the shareholders are the owners of the firm. The shareholders elect the directors of the corporation, who in turn appoint the firm’s management. This separation of ownership from control in the corporate form of organisation is what causes agency problems to exist. Management may act in its own or someone else’s best interests, rather than those of the shareholders. If such events occur, they may contradict the goal of maximising the share price of the equity of the firm. Since such organisations frequently pursue social or political missions, many different goals are conceivable. One goal that is often cited is revenue minimisation; i.e., providing their goods and services to society at the lowest possible cost. Another approach might be to observe that even a not-for-profit business has equity. Thus, an appropriate goal would be to maximise the value of the equity.…

    • 419 Words
    • 2 Pages
    Good Essays
    Read More
  • Good Essays

    Worldwide Paper
    • 1269 Words
    • 6 Pages

    Worldwide Paper

    What is the nature of the investment that is under consideration and what are the sources of value (cost savings and revenue increases)?…

    • 1269 Words
    • 6 Pages
    Good Essays
    Read More
  • Satisfactory Essays

    Modern Financial System
    • 373 Words
    • 2 Pages

    Modern Financial System

    * Increased flow of savings (if financial instruments have the ‘4 attributes’), important for economic growth (savings are available for investment). Ensure that savings are available/directed to the most efficient users of those funds.…

    • 373 Words
    • 2 Pages
    Satisfactory Essays
    Read More
  • Satisfactory Essays

    Pros And Cons Labour Productivity
    • 460 Words
    • 2 Pages

    Pros And Cons Labour Productivity

    1. Over investing on people during downturn leads to heavy loss to the investor and even leads to bankruptcy at times.…

    • 460 Words
    • 2 Pages
    Satisfactory Essays
    Read More
  • Satisfactory Essays

    Weak Labor
    • 336 Words
    • 2 Pages

    Weak Labor

    The expansionary fiscal policy should be used to boost economic growth and decrease unemployment. It would increase government spending and tax revenues would be cut. This would input more money into the economy and spur economic growth. This policy would essentially inspire the market’s confidence in the government which would lead to lower borrowing costs for the government. It is hard to implement this in 2012 because the public debt is high then, small increases in the interest rate can disrupt public finances. Moreover the increase in government spending would cause the reduction in the private investment sector, and since there would not be an expansion in the money supply to alleviate rise in income and money demand, the planned investment spending is crowded by the higher interest rate. Therefore, it would be unlikely to implement this policy due to the debt being so high and even higher interest rate would have a negative effect on the planned…

    • 336 Words
    • 2 Pages
    Satisfactory Essays
    Read More
  • Powerful Essays

    Cf Report
    • 2134 Words
    • 8 Pages

    Cf Report

    • Motivate the tension between investment policy and financial policy with respect to the sources and uses of cash.…

    • 2134 Words
    • 8 Pages
    Powerful Essays
    Read More
  • Good Essays

    Fiscal Policy Canada
    • 1200 Words
    • 5 Pages

    Fiscal Policy Canada

    Although the budget is currently in a slight surplus, the government should increase spending, in conjunction with the increase in taxes on Canada’s one percent. Attempting to balance the federal budget after getting out of a time of crisis will potentially push the economy back into a recessive state. With an increase in interest rates in an attempt to encourage savings from the middle class sector, there will be an increase in supply of loanable funds and a decrease in demand of loanable funds as not as many people will be able to afford the higher interest rates. This discourages firms and households from investing in infrastructure or capital equipment. However, with an increase in supply of loanable funds, the government can borrow the surplus of loanable funds in order to decrease their debt, without crowding out individuals who are interested in investing. Without investment, it is very difficult for the economy to experience growth, as they will be less productive without technological and machinery advancements. Therefore, to encourage investment, the government can offer investment tax incentives to firms and households who are looking to invest in infrastructure and/or capital equipment in order to increase efficiency, and thus…

    • 1200 Words
    • 5 Pages
    Good Essays
    Read More
  • Satisfactory Essays

    Human Space Exploration
    • 492 Words
    • 2 Pages

    Human Space Exploration

    -Public Sector Investment: the part of an economy that consists of state-owned institutions, including nationalized industries and services provided by local authorities…

    • 492 Words
    • 2 Pages
    Satisfactory Essays
    Read More
  • Satisfactory Essays

    Top 10
    • 764 Words
    • 4 Pages

    Top 10

    3. fiscal as well as monitory policy my be needed to correct the disequilibrium or improve the efficiency of economy…

    • 764 Words
    • 4 Pages
    Satisfactory Essays
    Read More
  • Powerful Essays

    Long Term Investment Decisions
    • 3856 Words
    • 10 Pages

    Long Term Investment Decisions

    In this paper I will outline long-term investment decisions, including the price elasticity of demand, how to make prices as inelastic as possible by using strategic plans, the difference between demand and elasticity, the economic impact of production and unemployment on our company, the reasons why the government will get involved in economic decisions, the capital project expansions and their complexities, some actions to prevent these complexities, the convergence between stockholder interests and those of management, and the impact on profitability, along with examples. These factors, their consequences, and remedial actions will be discussed, hopefully to prevent the negative factors from occurring. Positive factors will also be discussed, along with actions to keep these factors occurring on an ongoing basis.…

    • 3856 Words
    • 10 Pages
    Powerful Essays
    Read More
  • Good Essays

    Nuzair
    • 1100 Words
    • 5 Pages

    Nuzair

    to ensure value creation for the shareholders in terms of dividend payout and share repurchases…

    • 1100 Words
    • 5 Pages
    Good Essays
    Read More
  • Powerful Essays

    Notes: Modern Portfolio Theory and Distance Education M.i.m.
    • 3116 Words
    • 13 Pages

    Notes: Modern Portfolio Theory and Distance Education M.i.m.

    12. Being as a junior security analyst in a conservative research department, how might you try to convince the management to experiment with more modern techniques of company analysis?…

    • 3116 Words
    • 13 Pages
    Powerful Essays
    Read More
  • Powerful Essays

    Inflation and Govt Expenditure
    • 2255 Words
    • 10 Pages

    Inflation and Govt Expenditure

    Most analysts therefore argued that deficit reduction is crucial to the future growth of an economy, although, economists are divided over its impacts. It is expected that lower budget deficits will lower real interest rates, increase investment, and thereby increase productivity, growth and real income. A country experiences deficit in her budgetary system when its expenditure exceeds its revenue while budget deficit financing reflect the means of operating budget deficit of the country. However, the source of finance has varying impact of a growing public expenditure on inflation. The major…

    • 2255 Words
    • 10 Pages
    Powerful Essays
    Read More
  • Good Essays

    Discuss the effectiveness of fiscal policy to promote economic growth
    • 733 Words
    • 3 Pages

    Discuss the effectiveness of fiscal policy to promote economic growth

    Fiscal policy is the use of government expenditure and revenue in order to influence the economy and fund public goods and services. Fiscal policy is the main instrument government uses in order to try and create economic growth. However its actual effectiveness at meeting this objective is arguably not that good for a number of reasons which will be discussed in this essay.…

    • 733 Words
    • 3 Pages
    Good Essays
    Read More

Related Topics