India Plans to Raise $24 Billion by Selling Assets, LIC IPO

(Bloomberg) -- India plans to raise 1.75 billion rupees ($24 billion) selling assets including its flagship carrier Air India Ltd. and Bharat Petroleum Corp. as it attempts to raise funds to finance projects aimed at reviving Asia's third-largest economy.

The government will also seek buyers for Shipping Corp. of India, IDBI Bank Ltd. and two other banks, Finance Minister Nirmala Sitharaman said in her speech outlining the nation's budget for the year starting April 1.

Selling assets will be a key pillar for Prime Minister Narendra Modi's administration's move to boost spending. Investors though may want to see some big-ticket sales since the government has so far failed to raise even 10% of the 2.1 trillion rupees target for the current fiscal year and didn't meet the goal it set even in the previous year.

The government forecasts gross domestic product will accelerate to 11% next fiscal, after possibly contracting the most since at least 1952.

Asset sale proceeds are crucial for the government to meet its spending requirements and lower the budget deficit that's may widen to 9.5% of the gross domestic product this year -- against the aim of 3.5% -- and is seeing narrowing to 6.8% in the fiscal year starting April 1, according to people with knowledge of the matter.

The government will also sell shares in Life Insurance Corp. of India, Sitharaman said.

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