Revival Package for Rashtriya Ispat Nigam Limited (RINL)
The Union Cabinet Committee on Economic Affairs has approved a financial package of Rs 11,440 crore to revive the struggling state-owned Rashtriya Ispat Nigam Limited (RINL), which operates the Visakhapatnam Steel Plant.
Privatization Plans Abandoned
The government has shifted its strategy from privatization to a bailout, marking a departure from its previous approval for the 100% disinvestment of RINL.
Impact on Strategic Disinvestment Policy
- The shift in policy highlights the slow progress in the government's strategic disinvestment efforts.
- Ambitious disinvestment targets have been scaled back, and proceeds are now classified under miscellaneous capital receipts.
- The financial dependency of PSUs on the Union government has increased, with government support rising from 25% to 61% of total capital outlay between 2019-20 and 2023-24.
Future Outlook
PSUs are expected to generate Rs 3.7 trillion and receive Rs 5.45 trillion in government support for a capital outlay plan of Rs 9.13 trillion in 2024-25.
