INSUBCONTINENT EXCLUSIVE:
Finance Minister Arun Jaitley is expected to announce target while presenting an interim budgetThe government is likely to seek to raise
about Rs 80,000 crore ($11.21 billion) through sale of state-owned assets in next fiscal year, beginning April 1, two government sources
with direct knowledge of Budget discussions told Reuters on Tuesday.The target, which is same as for current financial year, includes
proceeds from expected privatisation of loss-making national carrier Air India, and sale of an insurer to be created by merger of three
state-owned firms, sources said
It will also involve sale of units in an exchange traded fund consisting of minority stakes in about 20 state-owned companies, they
said.Finance Minister Arun Jaitley, who is currently in United States for a medical check-up, is expected to announce target while
presenting an interim budget on February 1, said one of sources.The government could also sell shares in a number of state-owned companies
through initial public offerings, sources said
Possible candidates for these include Telecommunications Consultants India, Indian Railways' subsidiaries IRCTC, RailTel Corporation India
and National Seeds Corporation (NSC), they added.The government has proposed merging three state-owned general insurance companies -
National Insurance, Oriental Insurance and United Insurance - and then listing single entity.The government failed to attract bidders for
Air India when it tried to sell a majority stake in 2018
But airline is now being restructured and to make it more attractive just over half of its debt will be placed in another company and will
not be part of any future sale, one of sources said.The receipts target could change if government of Prime Minister Narendra Modi gets less
of a mandate from voters in next general election, which must be held by early May
PM Modi's ruling Bharatiya Janata Party lost some key state elections at end of last year, opening up possibility that it might lose power
or only get returned by forming a coalition with some other parties."The actual receipts from privatisation programme will depend how strong
is mandate of next government, and its commitment to privatisation," said first official, who declined to be named as budget details are not
public.If PM Modi got a strong mandate, government could even consider selling majority stakes in some of country's many state-owned
banks, official said.Any change would be made in a full-year budget, likely to be presented in July.Behind targetThere are also likely to be
concerns about whether government will be able to reach goal
With about two months to go before current year closes on March 31, government has so far managed to raise only Rs 35,100 crore, about 43
per cent of Rs 80,000 crore targeted
And some of those receipts are result of state-owned companies buying their own shares back from government.The government sources said they
expected there would be significant progress towards this year's target in next few weeks."We have not asked government to revise down
target this year," said second official.The struggle to meet current year's target has promoted some bankers and credit ratings analysts
to suggest government would likely miss this year's budget target by around Rs 20,000 crore.In a note last week, Care Ratings said meeting
share sale target will be challenging for government this year given volatile conditions in financial markets.($1 = Rs 71.35) Find latest
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