Air India and Pawan Hans Ltd are among 28 central public sector enterprises (CPSEs), which have been approved 'in principle' for strategic disinvestment by the Cabinet Committee on Economic Affairs (CCEA), Minister of State for Finance and Corporate Affairs Anurag Thakur informed the Lok Sabha on Monday.
He said that for achieving disinvestment targets, the government uses various modes of disinvestment including Initial Public Offer (IPO), Offer For Sale (OFS), buyback of shares, strategic Disinvestment and Exchange Traded Funds (ETF).
"The execution and outcome of disinvestment transactions are dependent on the prevailing market conditions and investor interest," the minister said.
The budget target for disinvestment during 2019-20 has been set at Rs 1,05,000 crore and the government has so far raised Rs 17,364.26 crore, Thakur told the Lower House of Parliament in a written reply.
He said the government is following the policy of strategic disinvestment, which is guided by the economic principle that the government should not continue in business in sectors, where competitive markets have come of age and economic potential of such entities may be better discovered in the hands of strategic investor due to factors such as infusion of capital, technological upgrading, and efficient management practices.
"Profitability of CPSEs is not the criteria for selection of CPSE for this purpose (disinvestment). Besides, in certain other CPSEs, which also include profit-making CPSEs, a policy of minority stake sale without transfer of management control through various SEBI approved methods is also being followed," added Thakur.