What Is The Difference Between Disinvestment & Divestment?


2 Answers

Ramona  Vandusen Profile
Ramona Vandusen answered

Both are private and open associations. There is almost no
contrast amongst divestment and disinvestment, and both accomplish the same
objective of decreasing and not recharging capital. Divestments normally happen
when a specific division of an organization does not experience its desires. On
the other hand Disinvestment, otherwise called divestiture, happens when an
association exchanges or offers a portion of its advantages or a whole division
without the purpose of reinvesting in it.

Akshay Kalbag Profile
Akshay Kalbag answered
The term disinvestment is defined as the shrinkage of capital investment which is caused by the failure of a firm to maintain or replace its capital assets which are being used up or by the sale of the capital goods by the firm, such as the equipment owned by it. Disinvestment also means the withdrawal of capital from a country or a corporation.

It was a term which was 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 effort to boycott South Africa in the economic sphere. It was designed to pressurize the government of the African republic into abolishing its policy of apartheid, which was still in force at that time. Since the year 1991, the term 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 level.

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

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