Why is the Government of India disinvesting its equity in the Central Public Sector Enterprises (CPSEs)?

1. The Government intends to use the revenue earned from the disinvestment mainly to pay back the external debt.
2. The Government no longer intends to retain the management control of the CPSEs.

Which of the statements given above is/are correct?

The salient features of the Disinvestment Policy are:  Citizens have every right to own part of the shares of Public Sector Undertakings.  Public Sector Undertakings are the wealth of the Nation and this wealth should rest in the hands of the people.  While pursuing disinvestment, Government has to retain majority shareholding, i.e. at least 51% and management control of the Public Sector Undertakings.  Use of Disinvestment Proceeds  The income from the fund is to be used for the following broad investment objectives:  (a) 75% to finance selected social sector schemes, which promote education, health and employment  (b) 25% to meet the capital investment requirements of profitable and revivable CPSEs that yield adequate returns, in order to enlarge their capital base to finance expansion/diversification