Merger of Departments within the Finance Ministry
The Union government is in the process of merging two key departments of the finance ministry: the Department of Public Enterprises (DPE) and the Department of Investment and Public Asset Management (Dipam). This initiative aims to streamline operations and eliminate duplication of work.
Objectives and Rationale
- About 80% of the work of both departments involves close coordination, prompting the need for a merger to enhance efficiency.
- The merger is part of the government's strategy to focus on value creation instead of merely disinvestment.
Expected Outcomes
- The merger is anticipated to foster greater synergy between the departments.
- Significant reforms and large-scale investments are expected to drive growth, development, and job creation by CPSEs (Central Public Sector Enterprises).
Mandates and Functions
- Dipam:
- Manages central government investments in equity, focusing on disinvestment of CPSE equity.
- Oversees equity sales through offers for sale, private placement, or other methods within CPSEs.
- Consults on post-disinvestment issues, such as call options by strategic partners, though these remain with the administrative ministry or department.
- DPE:
- Acts as a central body for CPSEs, formulating policies on performance improvement, financial delegation, and personnel management.
- Collects data via the public enterprises survey and coordinates with various ministries, CPSEs, and relevant organizations.
Historical Context
- The Department of Disinvestment was established on December 10, 1999, and later became the Ministry of Disinvestment on September 6, 2001.
- It became a department under the Ministry of Finance on May 27, 2004, and was renamed DIPAM on April 14, 2016.
