The Government of India has nearly doubled its earnings from Public Sector Undertakings (PSUs) since 2020, now collecting ₹74,017 crore in 2024-25, as per The Hindu report. A major share, more than 40%, comes from just 5 large fuel PSUs as the Centre shifted focus to dividends due to a slowdown in disinvestment.
Dividend inflows from central government-owned non-bank PSUs jumped from ₹39,558 crore in 2020-21 to ₹74,017 crore in 2024-25. A significant portion came from Indian Oil Corporation (IOC) and Bharat Petroleum Corporation Limited (BPCL), whose payouts surged 255% between 2022-23 and 2024-25. Benefiting from a 65% fall in global crude prices, these firms posted stronger profits but passed just a 2% drop to consumers through petrol price cuts.
The Centre adopted a more deliberate approach post-pandemic, using dividends to offset slower progress on asset sales. As per official policy revisions shared in November 2024, each Central PSU must now deliver at least 30% of its Profit After Tax or 4% of its net worth as dividends, whichever is higher. This has positioned dividend receipts as a consistent revenue stream for the exchequer.
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IOC and BPCL saw input costs decline sharply after crude prices dipped from $116 per barrel in June 2022 to $70 per barrel by July 2025. However, the retail price of petrol remained nearly unchanged, registering only a ₹1.95 decline. This profitability gap allowed for enhanced dividends without impacting retail fuel prices considerably.
The Department of Investment and Public Asset Management (DIPAM) directed CPSEs in 2024 to prioritise dividend payments. These guidelines promote fiscal balance while maintaining investor confidence and supporting government budgetary needs.
The surge in dividends from major PSUs, especially fuel companies like IOC and BPCL, reinforced the government’s revenue amidst disinvestment delays. With strong profitability and supportive policies, Central PSUs have delivered growing returns to the exchequer since 2020.
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Published on: Jul 21, 2025, 2:32 PM IST
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