Government control won’t be diluted after cutting stake in PSUs to below 51%: FM

New Delhi, July 7 (IANS) Finance Minister Nirmala Sitharaman has said that the government will make sure that its control is not diluted after lowering its stake in public sector undertakings (PSUs) to below 51 per cent.

This came a day after in her Budget speech on Friday she said that the government will modify the present policy of retaining 51 per cent stake in PSUs.

The government will also continue with the strategic divestment of select Central Public Sector Enterprises (CPSEs).

Talking to mediapersons, Sitharaman said: "51 per cent control assumes that there is a company where the government directly holds 51 per cent and there are also government- run institutions holding additional stake (say 10 per cent).

"If the government intends to eventually seek more retail participation where employees of the company can purchase the shares, then even as the government retains 51 per cent, the extra holding through the government-run institutions can be released for employees who want to possess shares, by which the government control is not diluted."

During her Budget speech, Sitharaman said the government was looking whether it could pare its stake below 51 per cent on a case to case basis of CPSEs.

"Strategic disinvestment of select Central Public Sector Enterprises will continue to be a priority," she said.

"The government has decided to modify the present policy of retaining 51 per cent government stake in public sector undertakings, including that of government institutions," the Finance Minister said.