Govt may miss FY20 divestment target by Rs 400-500 billion

Mumbai: The government may fall short of its divestment target for the current financial year by 400-500 bln rupees as it is unlikely to complete the privatisation of Air India Ltd, Container Corp. of India Ltd and Bharat Petroleum Corp. Ltd by the end of March, Mint newspaper reported today.

"There is a lot of interest in the market among investors for the companies on offer. The transaction may also be completed successfully, but now it looks difficult that the money will reach the coffers before 31 March. That is a challenge," the report said quoting a finance ministry official.

However, the government may go ahead and show the expected proceeds from divestment in the revised estimate for 2019-20, the report said quoting the official.

Last month, the Cabinet Committee on Economic Affairs gave an in-principle approval for strategic disinvestment in Bharat Petroleum Corp and Container Corp of India.

While the government plans to sell its entire 53.29% stake in BPCL, for Container Corp it intends to sell 30.8% of its stake out of its current 54.8%. And, for Air India, the government has announced the sale of 100% ownership.

The government aims to raise a record high 1.05 trln rupees through disinvestment in 2019-20. In the current fiscal so far, the government has garnered 173.64 bln rupees in divestment proceeds.

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