Finance Minister Arun Jaitley confirmed on Thursday that the government is shoring up its plans for outright ‘strategic’ sales of some state-owned companies, and hinted that the first of these sales could be of commercial entities under the Ministry of Tourism.
“When I say strategic, there are some on which there is no difficulty in even strategic sales. I think the Ministry of Tourism themselves may take some initiatives,” Jaitley told reporters in a media interaction in the Finance Ministry.
The only listed public sector company under the Ministry of Tourism is Indian Tourism Development Co, while there are several other unlisted properties, including hotels.
Apart from targeting Rs 41,000 crore from minority stake sales in listed state-owned companies, Jaitley has also budgeted for proceeds of Rs 28,500 crore from strategic sales of certain PSUs this financial year, making the combined target of Rs 69,500 crore one of the most ambitious divestment targets ever.
On selling minority stakes in listed PSUs, Jaitley said the decision laid with the disinvestment department to sell 5-10 per cent stakes, based on market conditions.
"I do not know what is the appropriate time the department will decide, but the enabling permissions have been granted. Now it is for the department to choose the right name and the right time," he said.
On Wednesday, the Cabinet Committee on Economic Affairs (CCEA) approved the plan to sell stakes in Indian Oil and NTPC. At current share prices, a planned 10 per cent stake sale in Indian Oil could fetch Rs 8,120 crore, while a 5 per cent stake sale in NTPC could get the exchequer Rs 5,689 crore.
The government has so far sold stakes in only one company this year, Rural Electrification Corporation in April for Rs 1,600 crore. Some other names in which a five to 15 per cent stake could be sold include Coal India, NMDC, National Aluminium Company (Nalco), Dredging Corp, Bharat Heavy Electricals (BHEL), MMTC, Hindustan Copper, National Fertilizers and Indian Tourism Development Corp.
