To help the Central government deal with “fiscal crunch”, the government has asked central public sector enterprises (CPSEs) to pay 30 per cent dividend and cash-rich PSUs like Coal India to issue bon
To help the Central government deal with “fiscal crunch”, the government has asked central public sector enterprises (CPSEs) to pay 30 per cent dividend and cash-rich PSUs like Coal India to issue bonus shares.
The CPSEs have also been suggested to rely on market borrowings for capital requirements as it would “enforce more professionalism”.
“Keeping in view the fact that the government of India is a majority shareholder in CPSEs, it has been decided that henceforth... a CPSE would pay an annual dividend of 30 per cent of PAT or 30 per cent of GoI’s equity holding, whichever is higher,” said a statment signed by department of economic affairs secretary Shaktikanta Das.
Also, CPSE with “large cash/free reserves and su-stainable profit may issue bonus shares”, it added while issuing the dividends payment policy for public owned companies.
The policy further said that due account should be taken of case and free reserves with the CPSE, and accordingly special dividend would “need to be paid” to the government, as a return for its equity investments.
As per the Budget estimates for 2015-16, Rs 36,000 crore is expected to come as dividend from public sector entities during the current fiscal.
