Govt okays ` 44,000-cr stake sale in 3 big PSUs
Cabinet clears disinvestment in Coal India, ONGC and NHPC; share-sale revenue would be highest in a single year
GOVT
CONFIDENT OF MEETING STAKE-SALE REVENUE TARGET FOR THIS FISCAL. EXPECTS
SAIL DISINVESTMENT TO ALSO GO THROUGH SOMETIME THIS YEAR
NEW DELHI: The government on Wednesday approved share-sale plans in
three major state-owned companies — Coal India Limited (CIL) , NHPC and
ONGC — that can potentially earn the exchequer ` 44,000 crore.
If successfully concluded, the government can more than meet the ` 43,425-crore target it had set for earnings from stake sales in public sector companies in the current financial year.
It would also be the most the government has ever earned as disinvestment revenue in a single year, surpassing the previous best of ` 23,857.25 crore in 2011-12.
Revenue from selling shares in state-owned companies is critical to the government’s plans to keep the fiscal deficit — shorthand for the amount of money it borrows to fund its expenses — at 4.1% of the GDP in 2014-15.
“Disinvestment proposals of ONGC, Coal India and NHPC have been cleared by the cabinet committee on economic affairs (CCEA),” said an official statement after a meeting of the CCEA, which is headed by Prime Minister Narendra Modi.
The CCEA cleared a 10% stake dilution in Coal India, 5% in oil production major ONGC and 11.36% in power company NHPC.
At current market prices, the sale of shares could garner over `
23,000 crore, ` 18,000 crore and ` 2,800 crore, respectively.
Besides, the previous government had cleared disinvestment in SAIL and according to sources, the 5% stake sale in the stateowned steel maker could take place this month itself, fetching the Centre an additional ` 1,600 crore.
The government has missed its disinvestment target for five consecutive financial years. Last year, it could raise only ` 16,027 crore against a budgeted target of ` 40,000 crore.
The Centre has already selected merchant bankers to manage the ONGC and NHPC offers and will likely do the same for Coal India shortly, although it has to convince labour unions opposed to share sale plans in the world’s largest coal mining company.
The cabinet approval came weeks after capital market regulator Securities Exchange Board of India approve d sweeping new norms, including making it mandatory for listed PSUs to pare promoters’ shareholding to 75% within the next three years.
The government currently holds stakes of 89.65% in Coal India, 85.96% in NHPC and 68.94% in ONGC.
nagesh dubey
Besides, the previous government had cleared disinvestment in SAIL and according to sources, the 5% stake sale in the stateowned steel maker could take place this month itself, fetching the Centre an additional ` 1,600 crore.
The government has missed its disinvestment target for five consecutive financial years. Last year, it could raise only ` 16,027 crore against a budgeted target of ` 40,000 crore.
The Centre has already selected merchant bankers to manage the ONGC and NHPC offers and will likely do the same for Coal India shortly, although it has to convince labour unions opposed to share sale plans in the world’s largest coal mining company.
The cabinet approval came weeks after capital market regulator Securities Exchange Board of India approve d sweeping new norms, including making it mandatory for listed PSUs to pare promoters’ shareholding to 75% within the next three years.
The government currently holds stakes of 89.65% in Coal India, 85.96% in NHPC and 68.94% in ONGC.
nagesh dubey
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