The current fiscal year disinvestment target is Rs. 50000 crore likely to be missed

Mumbai, Ta. December 26, 2019, Thursday

Since the privatization of Air India, BPCL and Container Corporation of India (Concor) is unlikely to be completed before March 7, the target of disinvestment of Fiscal Year 1 is expected to be as low as Rs.

The government plans to raise Rs 1.8 lakh crore through disinvestment in the current financial year. However, till now only Rs 1 crore could be raised. Since the disinvestment program of some government companies is not likely to be completed by March 7, the government is expecting a target deficit of Rs 1 to Rs 5 crore in the target.

The deficit could make it difficult for the government to keep the fiscal deficit limited to 5.5 per cent of GDP at the end of the fiscal, an analyst said. Investors also appear to be eager to invest money in companies whose government plans for disinvestment. Deals may be made before the end of the year, but the government's treasury is less likely to receive money before the end of March.

The government plans to sell 5 per cent of its total stake in Air India. The government assumes sales of 8.5 per cent in BPCL and 5.5 per cent in Concor.

According to SEBI guidelines, the sale of shares of listed companies will require delay in the disinvestment process if there is an open offer for minority shareholders, the analyst added. Successful bidders also need permission from the Competition Commission. However, in the case of a transaction, the government can show expected revenue in its book.