Cabinet allows PSUs to buy back shares

New Delhi: The Cabinet has allowed state-run companies to buy back shares and participate in the government's divestment programme.

"The Cabinet Committee on Economic Affairs has approved the buy back proposal," Minister of Heavy Industries Praful Patel said.

The government is far short of meeting its target of raising Rs 40,000 crore through stake sales in the current fiscal year ending in March.

Sources say only PSU with surplus cash after capex can participate in buyback offers. The timeline of the buy back, however, remains uncertain.

The individual PSU boards will take a final call on buy back, say sources.