💹 PSU Dividends to Centre Nearly Double Since 2020: What It Means for India’s Budget
India’s public sector enterprises are delivering more than just services—they’re now powering a larger share of the Union government’s income.
According to a recent report, dividends paid by PSUs to the central government have nearly doubled between 2020 and 2025. Enterprises like ONGC, Coal India, and BPCL have contributed significantly, thanks to their consistent profitability.
Why is this important?
Dividends from PSUs are classified under the government’s non-tax revenue, which falls within the revenue receipts section of the Union Budget. This means it's a sustainable income source for the Centre—outside of taxes like GST and income tax.
Understanding this distinction helps us better grasp:
How India’s budget is financed
The role of PSUs in fiscal management
Why non-tax revenue is a vital part of the Consolidated Fund of India
Additionally, this highlights the difference between dividends and disinvestment:
Dividends = regular income from ownership
Disinvestment = sale of government stake, shown under capital receipts
This growing dividend inflow strengthens India’s fiscal resilience without raising tax burdens—a powerful reminder of the importance of strong, profitable public enterprises.
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