MUMBAI (Reuters) – India will likely lower its divestment and asset monetization target by 40 percent for 2024-25 in the federal budget to be presented next month, with planned sales of state-run companies hitting a set of setbacks, the Economic Times reported on Saturday.
The government is likely to revise the target to less than 300 billion rupees ($3.47 billion) from the initial 500 billion rupees, the newspaper said, citing people familiar with the deliberations.
The government may set the target at around Rs450 billion to Rs500 billion for the next fiscal year, as it intends to complete IDBI Bank (NS:) deal and intensifying the asset monetization offer, the report said.
The Finance Ministry did not immediately respond to an email from Reuters requesting comment.
The Indian government owns 45.48% in IDBI Bank, which is state-owned life insurance (NS:) India, which owns 49.24%, together plans to sell 60.7% of the lender. The sale was first announced in 2022.
Prime Minister Narendra Modi's administration moved from the usual practice of setting a quota sale target in its budget submission last year.
Modi's ambition to privatize state-run companies has been tempered by regulatory hurdles, a complex decision-making process, political considerations and valuation issues, but his government has achieved larger stake sales than any previous administration.
The government has collected Rs 86.25 billion from disinvestment so far this fiscal year.
The report added that the government will continue to reduce its shares in some entities through offering them for sale.
($1 = 86.5710 Indian rupees)
