The Iran war has led to a sharp rise in the price of crude oil and fertilizers. This is bound to increase the government’s subsidy bill. Meanwhile, the government has raised ₹20,000 crore in the first two months of this financial year. This represents approximately 25% of the government’s target for the entire financial year.
Add rightsofemployees.com as a Preferred Source
New Delhi: Amid the Iran war, the government has raised approximately ₹20,000 crore from disinvestment and asset sales in the first two months of this financial year. The ongoing conflict in West Asia has led to a sharp rise in the price of crude oil and fertilizers, increasing the government’s subsidy expenditure. Consequently, the government is implementing a strategy to raise resources through non-tax revenue. The funds raised so far represent approximately 25% of the full-year target. The government has set a disinvestment target of ₹80,000 crore this year.
The Fertilizer Ministry has demanded a doubling of subsidies for the current financial year . This year’s budget provided a subsidy of ₹1.7 lakh crore for fertilizers. The government is also urging domestic companies to increase fertilizer production. The Iran war has also created uncertainty regarding the availability of ships, and many fertilizer suppliers are withdrawing from the market.
subsidy on gas cylinder
Additionally, to mitigate the impact of high crude oil prices, the central government has provided state-owned oil companies with over ₹1.2 lakh crore in aid, including a reduction in excise duty. Oil companies recently increased the prices of petrol, diesel, and LPG. Further increases are possible in installments. The central government will also have to provide subsidies for gas cylinders, as oil companies are still incurring losses of approximately ₹700 crore daily. A senior official stated that there are no plans to cut or modify expenditures at this time, but parliamentary approval will not be required for additional spending during the monsoon session. The situation on revenue and expenditure fronts will become clearer in mid-July, when first-quarter data is available. The official added that there is no need to review our expenditure plans now, as we took global uncertainty into account when presenting the budget.
Disinvestment and Asset Sale
The government has raised Rs 12,166 crore through disinvestment.
Similarly, Rs 6,367 crore has come from asset monetisation.
Raised money through OFS in Central Bank, Coal India and NHPC
Government preparing to sell up to 3% stake in NLC India
How did you raise the money?
But due to problems arising from the outbreak of war in West Asia, the government is attempting to raise more funds through disinvestment and asset monetization. Officials said Finance Minister Nirmala Sitharaman is reviewing the situation. The Department of Investment and Public Asset Monetization and the Department of Public Enterprises have plans ready not only for the entire year but also for the medium term.
So far this financial year, ₹12,166 crore has been raised through disinvestment. Similarly, ₹6,367 crore has come from asset monetization. Funds have been raised through offers-for-sale in Central Bank, Coal India, and NHPC. The government is also preparing to sell up to 3% of its stake in NLC India. The issue received 5.2 times subscription on its first day on Tuesday and is expected to raise ₹1,260 crore.
Add rightsofemployees.com as a Preferred Source
