The importance of disinvestment is i helpful in financing the increasing fiscal deficit ii...........

Economic and Social Issues Nature of Indian economy

Recently, the Cabinet has approved a new process of Strategic Disinvestment for expediting privatization of select PSUs.The Union Cabinet headed by Prime Minister Narendra Modi at its meeting approved the new policy under which the Department of Investment and Public Asset Management (DIPAM) under the Ministry of Finance has been made the nodal department for the strategic stake sale.This was done with a view to streamlining and speeding up the process, reducing the role of administrative ministries which often used to place hurdles in the path of major stake sales, officials said.Officials said strategic sale may involve two-stage bidding beginning with an expression of interest (EoI) or a preliminary intent showing bid, and a final financial bid. Pre-bid meetings with likely bidders and roadshows to attract potential investors will form part of the process to provide clarity on every aspect of the stake sale.

The importance of disinvestment is

i helpful in financing the increasing fiscal deficit.

ii funds can be utilised for long-terms goal

iii better environment for investment.

Select the correct answer using the code given below

i and ii only

ii and iii only

i and iii only

all of the above

none of these

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Explanation:

Importance of Disinvestment

In the short run, it is helpful in financing the increasing fiscal deficit.
Disinvestment funds can be utilised for long-terms goals such as:

-Financing large-scale infrastructure development.
-Investing in the economy to encourage spending
-Expansion and Diversification of the firm.
-Repayment of Government Debts: Almost 40-45% of the Centre’s revenue receipts go towards repaying public debt/interest
-Investing in social programs like health and education