Cabinet Meeting Live: Union Cabinet To Meet In New Delhi At 6:30 P.M.
Divestment Talks On The Table?
India’s Union cabinet may decide on selling stakes in public sector units and central public sector enterprises as it meets today for the first time since Prime Minister Narendra Modi’s return from the U.S.
A panel of secretaries has proposed that the government should exit four PSUs—Bharat Petroleum Corporation Ltd., Shipping Corporation of India Ltd., THDC Ltd., and North Eastern Electric Power Corporation Ltd.—and pare its stake in Container Corporation of India Ltd. The proposal is likely to be taken up today by the cabinet, Times of India reported citing people aware of the matter.
ET NOW reported that the panel expects the government to miss its Rs 1.05-lakh-crore target without divesting stake in these firms.
The mop-up from PSU stake sales assumes significance against the backdrop of the corporate tax cuts, which will cost the government Rs 1.45 lakh crore in revenue in the ongoing financial year. This also raises questions whether India will be able to achieve its fiscal deficit target for 2019-20. This also comes at a time India’s growth fell to its lowest in six years. Besides, a number of flood-hit states have been demanding compensation from the central government.
A senior finance ministry official had earlier told PTI that the government will sell “whatever is saleable” and may even bring down its stakes in select PSUs below 51 percent.
India is also considering giving up its controlling stake in BPCL, Bloomberg had reported citing people aware of the matter. Even if the cabinet chooses to privatise the oil retailer it will require a prior nod of Parliament.