Air India, BPCL, Concor Divestments ‘Unlikely’ In 2019-20: Government Official
The North Block of the Central Secretariat building, which houses the Ministries of Finance and Home Affairs, stands in New Delhi, India. (Photographer: Prashanth Vishwanathan/Bloomberg)

Air India, BPCL, Concor Divestments ‘Unlikely’ In 2019-20: Government Official

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The government’s strategic divestments in Air India, Bharat Petroleum Corporation Ltd. and Container Corporation of India Ltd. are "unlikely" to be completed in 2019-20, a finance ministry official said on Thursday.

The divestment process is on but is throwing up “surprises”, resulting in delays, the official in the ministry’s Department of Investment and Public Asset Management (DIPAM) said.

With just three months to go, India has mopped up less than a fifth of disinvestment target for 2019-20 even as the government struggles to contain fiscal deficit, BloombergQuint reported on Dec. 24.

The official declined to comment on the impact of such events on the fiscal math.

When asked about whether government’s stake sale in BPCL will be completed this fiscal, the official said "unlikely".

"We are not saying that for ourselves and our timelines are such that it should happen. But we know that the process throws up surprises," the official said speaking on the sidelines of an event in Mumbai. The BPCL stake sale can fetch more than Rs 60,000 crore if the govenrment offloads its entire 53 percent stake.

Similarly, on Concor and Air India, the official said that the sales will not go through in the financial year ending March 31.

According to him, the government is preparing the financial statements and getting the data room ready for the sales, suggesting that such aspects take time.

Till now, the industry has shown "excitement" over the divestment process, the official said, adding that additional details may be sought by potential bidders.

When asked about the strategic sale in Shipping Corporation of India, the official said the sale is at a certain stage and going strong. According to media reports, the stake sale in Shipping Corporation of India can fetch the government Rs 2,000 crore. The divestment in Concor can result in mop-up of more than Rs 13,000 crore.

Meanwhile, Edelweiss Mutual Fund's Bharat Bond Exchange Traded Fund listed on the National Stock Exchange on Thursday. Commenting on this, DIPAM’s Joint Secretary Anuradha Thakur said the government is working hard with the regulators in order to ensure that the bond market gets maximum traction.

The next step for the stakeholders is to ensure that there is trading in bonds in the secondary market which will ensure liquidity for investors, she said.

Rashesh Shah, chairman and chief executive of Edelweiss, said the Bharat Bond is the culmination of years of efforts put in by the government, regulators and his group. It provides stability for investors as it includes only ‘AAA’-rated public sector bonds, he added.

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