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As the Budget 2021 comes up with major thrust on privatisation of public sector enterprises, Disinvestment Secretary, Tuhin Kanta Pandey has said that the government's new disinvestment policy is aimed at economic growth and employment creation, rather than plugging the vast fiscal deficit.

The statement coming from the top official gains significance as the government's expenditure has surged amid the pandemic while revenues have been impacted, leading to a massive fiscal deficit.

In an interview with IANS, Pandey said: "Our privatisation policy is for growth and employment and not for the plugging of fiscal deficit."

The government has pegged the fiscal deficit for FY21 at 9.5 per cent of the GDP.

He is of the view that the government's latest privatisation push actually completes the liberalisation reforms of 1991.

The Secretary for the Department of Investment and Public Asset Management (DIPAM) said: "Now in the new phase, government is prepared to cede control, Normally, in government, people would not let the control go. So there is a voluntary effort of the government where you let the control go."

Noting that investor sentiments were subdued during the peak of the coronavirus pandemic last year due to uncertainty, he said that the investments have started coming now.

"The people have started investing and it is in tandem with our overall growth vision. The disinvestment policy is not a resource garnering policy. It is in tandem with the growth policy."

Speaking to IANS, Pandey exuded confidence that the much delayed disinvestment process of Air India and BPCL will get completed in the first quarter of the coming financial year.

Presenting her third Union Budget on February 1, Finance Minister Nirmala Sitharaman proposed to privatise two state-run banks apart from IDBI Bank and one general insurance company.

She also announced that all the previously announced disinvestment processes will be completed in FY22.

The government's disinvestment target for the upcoming fiscal at Rs 1.75 lakh crore. The disinvestment target for the current fiscal is Rs 2.10 lakh crore while the revenue collected through disinvestment is only Rs 19,499 crore.

(Subhash Narayan can be reached at subhash.n@ians.in and Rituraj Baruah can be contacted at rituraj.b@ians.in)