Centre unlikely to dilute strategic sale list despite ministries’ push for review
The government plans to proceed with its strategic sale of public sector enterprises. Ministries have requested reconsiderations, but few changes are expected. IDBI Bank remains the primary focus for a strategic sale process. The Centre aims to boost disinvestment receipts and demonstrate commitment to privatisation. New strategic sale cases will likely emerge after the IDBI Bank transaction.
The Centre appears unwilling to modify its list of public sector entities slated for strategic sale, despite repeated entreaties from multiple ministries to reassess the companies included in the privatisation plan, according to The Times of India. The government has been scrutinising the list of public sector companies earmarked for privatisation and closure, with the Prime Minister's Office at the helm of the process.
In recent months, ministries such as heavy industries, fertilisers, and housing have been pushing for modifications to the list. Ministries have already managed to have BPCL and Shipping Corporation of India taken off the original sell-off plan. However, officials informed The Times of India that there are limited options for further revisions.
Government departments have also convened inter-ministerial meetings to seek a review of the strategic sale plans. While some ministries have continuously approached NITI Aayog and other agencies with recommendations to reconsider the list, the Centre has communicated that ministries must collaborate to progress strategic sales. This push follows the government's aim to boost disinvestment earnings and show its dedication to the privatisation agenda.
The strategic sale procedure has encountered delays and uncertainty throughout the years. The government previously lacked a centralised list of companies being pursued for privatisation for an extended period, and several names, including BEML and Shipping Corporation of India, fell out of the process. At present, IDBI Bank is the sole significant entity actively pursued for strategic sale.
Fairfax, owned by Prem Watsa, and Emirates NBD are the two bidders competing for the bank, with both already having investments in Indian banks—Fairfax holds a stake in Catholic Syrian Bank, while Emirates NBD has a share in RBL Bank. The successful bidder might require an exemption from the Reserve Bank of India to run two banking operations in the country, according to officials.
The government is currently focusing on offer-for-sale transactions and initial public offerings. Officials revealed that fresh strategic sale cases are projected to be identified following the completion of the IDBI Bank transaction. The Centre, in its third year of the current term, must expedite the process to complete additional strategic sale deals.
Thus far, the government has raised over Rs 60,000 crore through disinvestment and is on track to surpass its Rs 80,000 crore objective if the IDBI Bank sale proceeds along with other planned minority stake sales.
Written by urgent.news from The Economic Times - Economy's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
