With complete dimming of prospects of disinvestment target being met in the current financial year and the markets expected to stay in subdued mood even in the next fiscal, the government is likely to drastically scale down targets for realization of resources from PSUs' stake sale in the Budget for 2016-17, ASSOCHAM said today.

"It is given that with just about a month to go for the Budget presentation and the window of opportunity having been missed earlier in the year, there is no hope that the over-optimistic target of Rs Rs 69,500 for the current financial year could be reached. Hopefully, the Finance Ministry will desist from setting an un-realistic disinvestment yet again for the FY 2016-17," the ASSOCHAM Paper on Budget expectations pointed out.

It said the disinvestment targets, ironically, have always been off the mark with either the government doing a mere academic budget making exercise or getting it completely wrong.

" It is nobody's case that we can always be on the top of the market moods and the projections can go wrong at times, but it is difficult to understand how year after year, these targets have gone completely haywire under successive governments" , the paper said.

The paper noted that but for a windfall from a steep reduction in the crude oil prices, the Finance Ministry would have found a huge shortfall in the Revenue Budget in 2015-16. "Bulk of the windfall has been retained by the government.

While it is debatable whether it has been the right or wrong strategy, the oil prices cut has certainly helped the Finance Ministry to come closer to the fiscal deficit target for the year".

The government has so far raised only Rs. 12700 crore through PSU disinvestments in the current fiscal and may raise another Rs 2000-3000 crore in the remaining months of this fiscal.

The government has missed its disinvestment target for fourth consecutive financial years. In 2013-14, the government has raised Rs. 15819 crore against the target of Rs. 40000 crore. In 2014-15 it raised Rs. 24277 crore against the target of Rs. 36925 crore.

As per ASSOCHAM study, Government may face a shortfall of at least Rs. 55000 crore with regard to disinvestment target. The government would meet the shortfall through higher taxable and non taxable routes.

In fact, the disinvestment target for FY 2015-16 had been increased by 88 percent over the last financial year to Rs. 69500 crore with the objective of generating non-debt resources to both boost public investment and contain fiscal deficit.

Of this, Rs. 41000 crore was to come from minority stake sale in PSUs and another Rs. 28500 crore from strategic stake sale.

For the past six years running, receipts have lagged targets with such regularity that underperformance now appears to be routine and accepted.

With regards to the dividend, the government is taking steps to push profit making PSUs to either increase their capital expenditure or pay higher dividends and suggested them not sit on cash pile.

By way of dividend from the profit making public sector enterprise, the government had budgeted to collect Rs 36,174 crore which is higher than last year's realisation of Rs 28,423 crore.

Through this initiative the Government has already received a dividend of Rs 65,896 crore from RBI, which is higher than this year's budget projection of Rs 64,477 crore.

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