PSUs NOT TO BE EXCLUDED FROM BUYING BAD ASSETS
than three-fourth of the central government budget.
Let us look at the National Health Policy. It talks about a steep increase in public expenditure, but to do that, an annual increase of at least 20 per cent for the next six-seven years will be required. Is your projection in sync with the Ministry’s standalone document?
We have only considered the central budget for the next three years. And we are generally conservative in our revenue estimates. If the government’s revenue for 2015/16 is roughly `20 lakh crore, it should be `27 lakh crore in nominal terms by 2019/20. That gives you an extra `7 lakh crore and that is the money we are using to reorient the expenditure composition. We have tried to move that additional money to sectors such as health, agriculture, rural development and infrastructure. This allows us to increase the central government’s expenditure on health from `30,000 crore in 2015/16 to `1 lakh crore in 2019/20. Therefore, our estimate goes a little farther than what the National Health Policy envisages.
Did you also recommend that public sector undertakings ( PSUs) buy bad assets?
No, we didn’t. But in principle, there is no reason why we should exclude PSUs from buying those assets. They can play a key role in ensuring that collusion among private buyers does not result in asset undervaluation. But in the longer run, we must continue with strategic disinvestment.
You have submitted a disinvestment plan for PSUs. Has the government considered it seriously?
The strategic sales that we have recommended will happen.
What will be the suggestions for the 15-year vision and the seven-year strategy?
We have a tough task here. Over a three-year horizon, you have a better handle on what is likely to happen and what the constraints are. Given the pace of technological change and the rapid geopolitical shifts, changes over a 15-year period are a lot more difficult to predict. We need to figure out where we will be in 15 years in terms of per capita income, health, education, employment, urbanisation and other such variables. The seven-year strategy can be more concrete. After three years, there will be an appraisal and at that point, we can reassess whether the original seven-year strategy should be rejigged.
Will there be an annual review of the three-year agenda?
I am sure the PM will ask at some point what we are supposed to implement and what we have actually implemented. ~