The Union government is unlikely to undertake any new public-sector undertaking (PSU) divestment—including privatisation of public-sector banks—in 2023-24, sources told the market daily Business Standard. It added that any such stake sale might take place only after the general elections next year.
“There is little chance of a new stake-sale transaction before the general elections. The priority will be to speed up the ongoing deals, including those to sell stakes in IDBI Bank, Shipping Corporation, and Container Corporation of India (Concor),” a senior official in the know told BS. “Even the proposed privatisation of two public-sector banks and a general insurance firm has been postponed,” he added.
The BS report further informed that as per the sources, the govt felt that this might not be an opportune time to privatise big state-run enterprises, as 2023-24 is the last financial year before the Lok Sabha elections to be held in April-May next year. Besides, global uncertainties could also not be ignored, as these influence both market conditions and government moves, it added.
However, it is important to note that the process is currently on to sell stakes in PSUs like IDBI Bank, Concor, Shipping Corporation, BEML, and NMDC Steel.
BS mentioned that IDBI Bank has already received preliminary bids while the Department of Investment and Public Asset Management (Dipam) is expecting financial bids by September Further, expressions of interest for Concor, however, might take longer, it noted.
For Shipping Corporation, meanwhile, the Dipam is in the process of starting the bidding process to divest the government’s 63 percent stake. The company received the Ministry of Corporate Affairs (MCA’s) approval for a demerger in January this year, added the report.
Meanwhile, the government has set a divestment target of ₹51,000 crore for 2023-24.
In her Budget speech for 2021-22, Finance Minister Nirmala Sitharaman said two public-sector banks and a general insurance company would be privatised.