A group of secretaries will meet on Oct. 18 to consider cutting the government's holding below 51 percent in at least eight public-sector companies, a person familiar with the matter said, as the Modi administration looks to bridge the budget gap.
Among the state-owned firms to be considered for the strategic sale are the nation's largest fuel refiner-retailer Indian Oil Corporation Ltd. and the biggest power producer NTPC Ltd., the person told BloombergQuint, asking not to be identified as he is not authorised to reveal details. Other companies on the list include Bharat Electronics Ltd., BEML Ltd., MOIL Ltd., Engineers India Ltd., GAIL (India) Ltd. and National Aluminium Company Ltd., he said.
If approved by the Core Group of Secretaries on Divestment, the proposals will then be tabled before the Cabinet Committee on Economic Affairs, he said. The group considers the proposals by NITI Aayog and the Department of Investment and Public Asset Management to facilitate decision-making and monitor execution.
Though the government will bring down its stake in these companies below 51 percent, it will continue to be the largest shareholder and retain management control in these companies.
The share sales are aimed at raising funds when the corporate tax rate cut to shore up growth from its six-year low and lower-than-expected tax collections threaten to widen the fiscal deficit. The government has set a divestment target of Rs 1.05 lakh crore for the ongoing fiscal ending March.
The Modi administration has already sought transaction advisers to privatise oil refiner-retailer Bharat Petroleum Corporation Ltd. and sell controlling stake in Container Corporation of India Ltd., North Eastern Electric Power Corporation Ltd., THDC India Ltd., and Shipping Corporation of India Ltd., according to the person quoted earlier. The Cabinet Committee on Economic Affairs is yet to give its final nod, he said.
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