New Delhi (24.09.2024): Two key departments -- Department of Investment & Public Asset Management (DIPAM) and the Department of Public Enterprises (DPE) – that deal with matters related to investment, regulation and performance management of Central PSUs may be merged. Informed sources said that if everything goes as proposed, the unified department would work under the Ministry of Finance as the government wants liquidity and synergy for its investment plans. It is expected that the merger would enhance synergy as the government is planning some big-ticket reforms and huge investments for growth, development and employment generation.
The proposal of the merger of DIPAM and DPE is not new. This was part of the agenda of NaMo 2.0 but somehow it could not become a reality. The project was picked up yet again in the list of "hundred days programme" conceived by the Centre before 2024 LS Polls.
DIPAM and DPE deal with matters (360) related to Central Public Sector Undertakings (CPSUs) and play a key role in investments in equity including disinvestment of equity and functioning and performance of CPSUs. Apart from the management and regulation of CPSEs, when it comes to divestment and closure DIPAM initiates the process while DPE settles the closure of business entities and this is where merger of the two departments gather logic.
HISTORY OF DIPAM & DPE:
Department of Public Enterprises (DPE):
The DPE was ideated when the Estimates Committee of the third Lok Sabha (1962-67) highlighted the need for establishing a centralized coordinating unit to continually assess the performance of public enterprises. Thus in 1965, the Bureau of Public Enterprises (BPE) came into existence under the Ministry of Finance. Later in 1985, it became part of the Ministry of Industry. In the next round of reforms in May 1990, BPE was elevated to a full-fledged department known as the Department of Public Enterprises (DPE) which plays a key role in formulation of policies and guidelines concerning the functioning, performance and categorisation of Central PSUs.
Department of Investment & Public Asset Management (DIPAM)
On the other hand, DIPAM deals with matters related to management of Central Government investments in equity including disinvestment of equity in CPSEs. DIPAM’s mandate envisages Strategic Disinvestment and Privatisation, Minority Stake Sales and Capital Restructuring.
The Department of Disinvestment was set up as a separate Department on 10.12.1999 and was later renamed as Ministry of Disinvestment w.e.f. 06.09.2001. From 27.05.2004, the Department of Disinvestment is one of the Departments under the Ministry of Finance. The Department of Disinvestment was renamed as DIPAM w.e.f. 14.04.2016.
