₹51,000 crore for FY24 is lower than the previous year’s original target. The estimates for FY23 had been revised to ₹50,000 crore from an earlier target of ₹65,000 crore. As of September 2023, the government has been able to garner ₹5,600 crore, primarily from offers to sell a 3% stake in Coal India Ltd and 5.36% in Rail Vikas Nigam Ltd.
Sabnavis noted that the government was likely to face more challenges in subsequent strategic sales since the low-hanging fruits have already been taken. “It becomes more challenging subsequently especially when the government stake has to go at less than 50%," he added. Strategic sales are where the government gives up its full shareholding in a public sector enterprise and hands over management control to a private player.
Government officials aware of the developments said any new strategic sales that may be of high value or involve a large public sector enterprise (PSE) are also likely to be shelved for later instead of being hived off in the coming months. “We will only be able to take the PSEs to the market when we think the timing is right. At present, there are several transactions ongoing which are taking time to culminate.
So, we will have to take a call taking all this into account," a senior government official said, asking not to be named. “As far as divestment is concerned, many things have to be considered and looked into, like regulatory and due diligence processes, before decisions are taken," a second official said, adding that the government was unlikely to achieve the divestment target this year. The government initiated the exercise of appointing an asset valuer last week, which is expected to close by next month.
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