Nirmala Sitharaman had set a disinvestment target of Rs 1.05 lakh crore in July for fiscal year 2019-20, raising it from an earlier target of Rs 90,000 crore that interim finance minister Piyush Goyal had set in the interim Budget on February 1.
A logo of Indian Oil is picture outside a fuel station. (File Photo: Reuters/Adnan Abid)
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The central government has prepared a plan to bring down its stake in some large central public sector enterprises (CPSEs) to below 51% in FY20 in order to raise funds to make up for tepid revenue growth.
On the disinvestment radar this fiscal are public sector units (PSUs) like Indian Oil Corp. Ltd (IOC), NTPC Ltd, Bharat Petroleum Corp. Ltd (BPCL), GAIL Ltd, Engineers India, Container Corporation and Nalco, said The Indian Express reported.
The report also added that the stake sale could happen either through the OFS (offer for sale) or ETF (exchange-traded fund) route, with a possibility of strategic stake sale of at least one of the PSUs.
The Centre currently holds below 55% stake in these PSUs, but it can still manage to retain a majority stake in these firms after disinvestment, as significant stakes in these companies are held by government-controlled institutions such as Life Insurance Corporation of India (LIC) or other large public sector firms (through CPSE cross-holdings).
Finance minister Nirmala Sitharaman had set disinvestment target of Rs 1.05 lakh crore in July for fiscal year 2019-20, raising it from an earlier target of Rs 90,000 crore that interim finance minister Piyush Goyal had set in the interim Budget on February 1. However, so far, the central government has managed to raise only 12% of the annual disinvestment target, the report noted.
Notably, the government had collected a record Rs 1 lakh crore in FY18 and Rs 85,000 crore in FY19 from disinvestment of its stake in various PSUs.
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Source: News18