Govt may lower disinvestment goal by 20% after missing FY24 target: Report

The government had set a disinvestment target to raise Rs 51,000 crore for the current financial year. However, only about 20 per cent of this target has been met so far

Budget 2024: The central government may lower its target for disinvestment plans in the upcoming financial year (FY25) compared to the FY24 estimate, according to media reports. With having met only about one-fifth of the disinvestment target of FY24 at Rs 10,050 so far, the Centre is likely to lower its target in FY25 by at least 20 per cent, Livemint reported.

The government had set an ambitious target to raise Rs 51,000 crore from the sale of the government's share in public sector companies for the current financial year. However, it is unlikely that this goal will be met.

The big-ticket privatisation plans, such as those of Bharat Petroleum Corporation Ltd (BPCL) and Shipping Corporation of India (SCI), already seem stalled for now. According to the experts, any meaningful privatisation can only happen after the general elections, likely scheduled for April or May. "Strategic disinvestment decisions are being governed by political necessities. With elections round the corner, we do not expect any movement on the strategic sale side," a market expert said.

IDBI, BEML on current list

According to the existing plan, the sale of NMDC Steel Ltd, BEML, HLL Lifecare and IDBI Bank were on the government's list in the current financial year.

However, with the process of due diligence and demerger of core and non-core assets yet to be completed with respect to most of these Central Public Sector Enterprises (CPSEs), there has been a delay in inviting financial bids. Thus, the disinvestment plan of these CPSEs will likely continue in FY25.

Rs 4.20 trillion fetched via disinvestment in last 10 years

According to the official data, around Rs 4.20 trillion was raised in the last decade via privatisation. Of these, Rs 3.15 trillion was realised from minority stake sales - IPO (Initial Public Offering) and OFS (Offer For Sale). Meanwhile, the sale of 10 CPSEs, including Air India, Hindustan Petroleum, REC, Dredging Corporation of India, HSCC, and Kamarajar Port, among others, fetched Rs 69,412 crore.

(With PTI inputs)