PSU NEWS
PSUs seek exemption from paying government huge dividends
NEW DELHI: Some top state-run firms, under immense pressure to pay a large dividend to fund government spending, are seeking exemption from making huge payouts as that may affect their capital expenditure plans and ratings, officials and industry executives said.
“The government is insisting that public sector companies pay the maximum possible dividend in this challenging financial year so that additional resources are available for state programmes without breaching the fiscal deficit target,” a source with direct knowledge of the matter said.
“The government is also encouraging PSUs to meet their capital spending needs through fresh borrowings.” Every state-run firm must pay a minimum dividend of 30% of its net profit or 5% of net worth, whichever is higher subject to the maximum dividend permitted under the law, according to a guideline issued last year.
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