Rupee coin.
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India will likely cut its disinvestment and asset monetization target by 40% for 2024-25 in the federal budget to be presented next month, The Economic Times newspaper reported on Saturday, as planned sales of state-run firms run into a host of setbacks.
The government will likely revise the target to less than 300 billion rupees ($3.47 billion) from the initial 500 billion rupees, the newspaper said, citing people aware of the deliberations.
The government may set the target at about 450 billion rupees to 500 billion rupees for the next fiscal year, as it intends to conclude the IDBI Bank transaction and step up its asset monetization bid, the report said.
The Finance Ministry did not immediately respond to a Reuters’ email seeking comment.
The Indian government, which owns 45.48% in IDBI Bank, and state-owned Life Insurance Corp of India which holds 49.24%, together plan to sell 60.7% of the lender. The sale process was first announced in 2022.
Prime Minister Narendra Modi’s administration moved from the usual practise of setting a stake sale target in its budget presented last year.
Modi’s ambition of privatizing state-run firms has taken a back seat due to regulatory hurdles, complex decision-making, political considerations and valuation issues, but his government has delivered more stake sales than any previous administration.
The government has raised 86.25 billion rupees from disinvestments so far in this fiscal year.
The government will continue to reduce its stakes in some entities via the offer-for-sale route, the report added.