As a part of the current Indian government’s privatization plan, to generate revenues and win invite foreign investors to the country, five state-owned companies to buy stakes from the government.
The finance minister of India, Miss Nirmala Sitharaman, announced that the government stakes to be sold in one of the largest Indian oil companies, Bharat Petroleum, as well as India’s logistics business Container Corporation, India’s Shipping Corporation, and two other firms.
Authorities are expecting oil majors to take particular interest in the sixth-largest Indian company by incomes, Bharat Petroleum. Major companies like Saudi Aramco, Total and BP, planning to invest in India, have shown interest in the expanding energy market of the country.
The recent announcement was done after the government’s previous decision to privatize Air India, after a failed attempt to find a single bidder for it last year. Ms. Sitharaman is hoping that Air India and Bharat Petroleum will be sold within a few months.
Modi’s government is planning to sell public assets to generate a revenue of Rs1.05tn ($14.6bn), to sustain the government finances and achieve its fiscal deficit goal of 3.3 percent, by the end of the current fiscal year i.e March 2020. But Nomura seems to be hopeless about to government's target and estimates the deficit to increase by 3.7 percent.
Immediate reforms to boost investment have been demanded by the Indian business leaders as the Indian economy is painfully decelerating.
According to an announcement by the government in September, corporate taxes to be reduced from 35 percent to 25 percent. As the first step of privatization, as thought by some analysts, a few state-run banks to be merged. The tax cut would require the disinvestment target by the government to be higher so that it can generate the forgone revenue, said UBS.
Tags : Miss Nirmala Sitharaman, Bharat Petroleum, Indian company, finance minister of India,