The government will keep trying to push on with the disinvestment in public sector companies with the Finance Minister fixing an even higher target for the next financial year of ₹1.5 trillion (it was ₹1.05 trillion for this year). The amount will be higher partly due to the fact that the government could not meet its target for this year by half even. The prominent one is the case of Air India where it wanted to mop up close to ₹20,000 crore but the process is yet to pick up steam. The government has tried all sorts of measures like making it a 100% disinvestment and cleaning up the balance sheet to remove the intangible debts to a separate entity and so on. The exercise is still at the expression of interest document stage and has a long way to go.
There were other targets like Bharat Petroleum Corp. Ltd (BPCL), Container Corporation of India Ltd (Concor) and Shipping Corporation of India Ltd (SCI). These too are likely to be carried over to the next financial year.
In terms of the government’s stakes to be divested, the entire 53.29% stake in BPCL and 30.8% stake in Concor out of its current 54.8% stake and 63.75% stake in SCI are the targets. Apart from these, the entire stake in Tehri Hydro Development Corp. (74.23%) and North Eastern Electric Power Corp. Ltd (100%) will be sold by the government to the other state-owned power company NTPC Ltd.
Where there are heavy overseas borrowings by some public sector companies like NTPC, the government may not find it easy to get out till the lenders give their approvals.
Just to place this issue in perspective, at the end of March 31, 2018, there were 339 central public sector enterprises (CPSEs) with a total paid-up capital of ₹2.5 trillion and reserves and surpluses of ₹9.42 trillion.
The bottom line is how the government will go about achieving its targets.