 "Air India. Photo: Shutterstock")
The government is unlikely to complete the strategic sale of Bharat Petroleum Corporation (BPCL), Container Corporation of India (Concor), and Air India by March-end, said a senior government official.
“The government has to respond to what the potential bidders ask for. Sometimes, they seek time to examine financial statements. Sometimes, they want to do physical due diligence,” said the official.
The likely delay in divestment plans comes when the government’s fiscal deficit has touched 115 per cent of the FY20 Budget estimate by November. Besides, revenue from other sources such as taxes is also likely to fall short of the target. The government may miss the tax target of Rs 24.6 trillion by at least Rs 2 trillion on account of the corporation tax rate cut, lacklustre GST collections, and the economic slowdown. As much as 42 per cent of the revenue collections (excluding cess and surcharge) will go to states.
The government had set a disinvestment target of Rs 1.05 trillion for 2019-20. However, in FY20 so far, the government has managed to raise Rs 17,364 crore through disinvestment; 84 per cent of its disinvestment target is yet to be realised.
The government has been trying to divest its entire stake of 53.3 per cent in BPCL to a strategic buyer, which can at least fetch Rs 56,359 crore based on Thursday’s closing price.
“The government has to respond to what the potential bidders ask for. Sometimes, they seek time to examine financial statements. Sometimes, they want to do physical due diligence,” said the official.
The likely delay in divestment plans comes when the government’s fiscal deficit has touched 115 per cent of the FY20 Budget estimate by November. Besides, revenue from other sources such as taxes is also likely to fall short of the target. The government may miss the tax target of Rs 24.6 trillion by at least Rs 2 trillion on account of the corporation tax rate cut, lacklustre GST collections, and the economic slowdown. As much as 42 per cent of the revenue collections (excluding cess and surcharge) will go to states.
The government had set a disinvestment target of Rs 1.05 trillion for 2019-20. However, in FY20 so far, the government has managed to raise Rs 17,364 crore through disinvestment; 84 per cent of its disinvestment target is yet to be realised.
The government has been trying to divest its entire stake of 53.3 per cent in BPCL to a strategic buyer, which can at least fetch Rs 56,359 crore based on Thursday’s closing price.
