Government raised hands with the disinvestment of Air India

by Patricia Lin
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Already, there is no good news from the disinvestment front for the central government, which is facing many problems on the revenue front. The target of Rs 1.05 lakh crore for the current financial year is not visible. The biggest cooperation in achieving this goal would be the disinvestment of Air India and BPCL, but the eligible buyers for both these companies do not appear to be. <! –

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With the disinvestment of Air India, the government has raised its hands in a way, while the disinvestment program of BPCL is likely to be pulled in the next financial year. The officials of Ministry of Finance and Petroleum are also assuming that the disinvestment of Hindustan Petroleum Corporation (BPCL) will be difficult to complete within the next three months. Despite the interest of many domestic and foreign companies in this company, it will take three to four months to complete the policy and regulation process of selling such a big company. So far, a letter of intent has not been issued by the government. After issuing a letter of intent, it may take two to two and a half months from the proposal of buying it from foreign companies, approving it and getting permission from the country's regulatory agencies for the entire process.

Let it be said that the government is expecting a revenue of at least 35 thousand crore rupees only from the disinvestment of BPCL. The government had decided on 20 November 2019 that it had decided to disinvest five big government companies, including BPCL. It was decided to hand over management control along with the government's entire stake in BPCL to the individual sector. The government also intends to buy a foreign petroleum company BPCL. The decision of the strategic sale of Shipping Corporation (SCI), Container Corporation (CONCorp), THDCI and NEEPCO can be implemented. Out of this, THDCI and NEEPCO in the power sector have to be sold to NTPC in the government sector only. The amount that the government will get from these four will be insufficient to meet the annual disinvestment target.

So far, the government has been able to achieve about 17,384 thousand crore rupees from the disinvestment during the current financial year. The hopes that were also with regard to the disinvestment of Air India have now collapsed. The statement has come from the government that Air India may have to be closed from March 31, 2020, if the buyer is not found. So far, despite talking to domestic and foreign aviation companies, there is no way out. Obviously, the impact of not achieving the disinvestment target will also be seen on the fiscal deficit. The fiscal deficit target has been set at 3.6 per cent, but recently many agencies have expressed the possibility that it is likely to be up to one per cent.

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