Govt's annual dividend from Central PSEs jumps 86 per cent in last 5 years
New Delhi, Dec 31
The dividend payout to the Government from Central public sector enterprises has jumped by 86.2 per cent from Rs 39,750 in 2020-21 to Rs 74,017 crore in 2024-25, reflecting the Centre's efficient capital management policies, enhanced accountability mechanisms, and appropriate spacing of disinvestment transactions, according to a statement issued by the Finance Ministry on Wednesday.
In 2025, the Finance Ministry's Department of Investment and Public Asset Management (DIPAM) continued to play a pivotal role in strengthening public finances, enhancing value creation in CPSEs, and deepening market-oriented reforms through effective capital management, strategic disinvestment, and focused capacity building initiatives, the statement said.
Despite the progressive dilution of Government shareholding in CPSEs through disinvestment, dividend payouts have consistently increased since FY 2020-21, the statement said.
Dividends from CPSEs form an important source of non-tax revenue. Dividend pay-outs are currently deliberated in a structured manner in the inter-Ministerial forum called the Committee for Monitoring of Capital Management and Dividends by CPSES. There has been a considerable improvement in the dividend payouts by CPSEs over the last five years.
Total dividend receipts from CPSEs over the last five financial years have shown a consistent upward trend, exceeding the corresponding Revised Estimates (RE) each year, the statement observed.
DIPAM also used the Offer for Sale (OFS) route to create value for CPSEs. Disinvestment of 3.61 per cent of the paid-up equity in Mazagon Dock Shipbuilders Limited out of the government's shareholding of 84.83 per cent in MDL through OFS was launched on April 4, 2025, for the non-retail category and on April 7, 2025, for the retail category.
In view of the oversubscription, under the non-retail category, a green shoe option was exercised. The government realised an amount of Rs 3,673.42 crore through the transaction. Post OFS, the market price of the stocks has generally witnessed an uptrend, adding to the capital gains of investors, the statement said.
As part of its broader Value Creation in CPSEs initiative, DIPAM undertook focused efforts to enhance leadership and communication capabilities within CPSEs. In collaboration with the Capacity Building Commission (CBC), DIPAM has organised a Workshop on Enhancing Leadership Communication Skills in January 2025. The workshop aimed to empower CPSE executives dealing with finance, business development, strategy, and communication, particularly in their engagement with investors and financial analysts. It enabled participants to identify communication gaps and engage in training sessions and simulated real-world experiences.
The Department also successfully organised the Capacity Building Programme on the Basics of Financial Markets conducted by the NSE for the officers and employees during the year.
"Through sustained improvement in dividend performance, successful market-based disinvestment, and targeted capacity building, DIPAM's initiatives in 2025 reinforced fiscal strength, promoted investor confidence, and advanced long-term value creation in CPSEs," the statement added.
— IANS
Reader Comments
While the increased dividend is good, I hope this money is used wisely for public welfare and not just to fill budgetary gaps. We need transparency on where these extra funds are being allocated. Also, disinvestment should not compromise the strategic control of key PSUs.
The focus on capacity building is the real story here. Training CPSE executives in financial markets and communication is a long-term positive move. It makes our public sector more professional and competitive on a global scale. More such initiatives are welcome!
As a retail investor who participated in the MDL OFS, I'm very pleased. The process was smooth and the stock has performed well post-disinvestment, giving good returns. It's encouraging to see the government creating value for small investors like us.
Good numbers, but let's not forget the employees of these CPSEs. With such high profits and dividends, are the workers getting better wages and benefits? Profitability should translate into better conditions for the people who actually run these companies day-to-day.
This is a solid achievement. Efficient capital management in PSUs was long overdue. The consistent upward trend over five years shows it's not a one-off but a result of policy focus. Hope this continues and strengthens our fiscal position. 🙏
We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.