The government plans to raise around Rs 3.25 trillion ($47.4 billion) in the next five years by reducing its stakes in some large state-owned firms to 40 per cent, two senior government officials said, in the nation’s biggest privatisation push in more than two decades. Last week, Finance Minister Nirmala Sitharaman in Budget announced that the government will look to reduce direct controlling stakes in some state-run firms on a case-by-case basis.
The plan will open up a steady stream of state companies to greater private investment, and target the kind of annual divestment revenue that will be crucial to meet fiscal deficit targets.
Prime Minister Narendra Modi’s administration already sold government stakes in a host of companies to raise a record $40.92 billion in his first five-year term, nearly three times the divestment proceeds of $14.52 billion achieved by the Congress government in 2009-2014. Modi was re-elected for a second-term in a landslide victory in April-May.