What Is The Difference Between Disinvestment & Divestment?


Answer:
The term disinvestment is defined as the shrinkage of capital investment which is caused by the end of a firm to maintain or replace its capital assets which are being used up or by the public sale of the capital goods by the firm, such as the equipment owned by it. Disinvestment also means the deduction of capital from a country or a corporation.

It was a term which be first used in the 1980's. It was most commonly used in the United States of America to refer to the use of a concerted stab to boycott South Africa in the economic sphere. It was designed to pressurize the management of the African republic into abolishing its policy of apartheid, which was still in force at that time. Since the year 1991, the permanent status disinvestment was used in India to mean the privatisation of assets which held by the State. The minister for disinvestment is a post at the cabinet even.

On the other hand, the term divestment means the disposal of a business or a segment of the business. It also system the disposal of certain sections of a business. It is usually done when a company finds that one of the divisions under its authority is carrying out those activities which are not compatible with what it regards as its core business comings and goings. The term divestment is also known as divestiture. It is a term which is commonly used surrounded by finance and economics. It refers to the reduction of some kind of assets, which is done to any attain some financial or social goals. The term divestment is contrary to the term investment.

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