The NDA-led government might well have the numbers in Parliament but what is in doubt is if it has the fiscal space to undertake measures required to kickstart a slowing economy and more importantly, to revive the rural economy via welfare measures.
In order to fund the welfare measures, the government in its Budget on Friday may come up with a clear road map to raise the funds required. As a part of it, the government is likely to raise the disinvestment target, look for higher dividend from the Reserve Bank of India and the 5G spectrum auction.
"..resources for now expanded Pradhan Mantri Kisan Samman Nidhi (PM-KISAN) and Ayushmaan Bharat as well as new initiatives of the new government will have to be found without compromising the fiscal deficit target as per the revised glide path," the Economic Survey said on Thursday.
Disinvestment in public sector units is a major route for the government to raise capital. The interim budget had set a disinvestment target of Rs 90,000 crore for the financial year 2019-2020. This may be raised further to Rs 1,00,000 to 1,50,000 crore.
Apart from strategic sale of loss-making and defunct PSUs, the government is also likely go ahead with an monetisation programme involving development and sale of surplus land parcel and other non-core assets of public sector enterprises. This would provide additional revenue stream for the Centre with money flowing either directly to its coffers or coming through higher dividend payout by the PSUs.
Senior government officials said that the new asset monetisation programme will hinge on a two-pronged strategy. One will involve strategic sale of loss making and defunct PSEs sitting on large tracts of land that could be commercially utilised.
The second part of the strategy will be to get even existing profit-making PSEs such as the ONGC, the NTPC, the SAIL, the BHEL, the Airports Authority of India, the PowerGrid, to sell some of their non-core assets, including manufacturing units and surplus land to realise funds that could be invested in new projects where private investments are not forthcoming.
A panel led by former RBI Governor Bimal Jalan was set up late last year to decide the appropriate capital reserves the apex bank should maintain. Going by a report by Bank of America Merrill Lynch, the panel may suggest a transfer of Rs 3 lakh crore.
The 5G spectrum auction which is likely to be held in October, may create a revenue of Rs 4.5 lakh crore in total if the spectrum prices are not changed. Out of the total anticipated amount, Rs 70,000 crore is likely grace the government's coffers in the ongoing fiscal year 2019-20.