Recent changes in management of Disinvestment Proceeds

The Department of Disinvestment was set up as a separate Department in 1999 and since 2004 it has been made as one of the Departments under the Ministry of Finance. The Department of Disinvestment was renamed as Department of Investment and Public Asset Management (DIPAM) in the 2016-2017 Budget and was assigned the following functions:

♤ It was responsible for all matters relating to management of Central Government investments in equity including disinvestment of equity in Central Public Sector Undertakings.

♤ All matters relating to sale of Central Government equity through offer for sale or private placement or any other mode in the erstwhile Central Public Sector Undertakings.

♤ Decisions on the recommendations of Administrative Ministries, NITI Aayog, etc. for disinvestment including strategic disinvestment.

♤ Decisions in matters relating to Central Public Sector Undertakings for purposes of Government investment in equity like capital restructuring, bonus, dividends, disinvestment of government equity and other related issues.

♤ Advise the Government in matters of financial restructuring of the Central Public Sector Enterprises and for attracting investment in the said Enterprises through capital market.

However, to streamline the disinvestment process, in January 2017, the government transferred the role of advising the government on how to utilize the proceeds from disinvestment from the Department of Investment and Public Asset Management (DIPAM) to the Department of Economic Affairs. The Department of Economic Affairs in the Finance Ministry will now be in charge of “financial policy in regard to the utilisation of the proceeds of disinvestment channelized into the National Investment Fund.”