Strategic disinvestments may get a fillip with the Cabinet Committee on Economic Affairs (CCEA) approving a revised institutionalised mechanism for speedy completion of such transactions.
The CCEA on Wednesday gave its nod for setting up an alternative mechanism, wherein the Finance Minister, the Minister for Road Transport & Highways and the Minister of the administrative department will decide on the terms of such deals.
This alternative mechanism will decide on the terms and conditions of the sale from the stage of inviting of expression of interest (EoI) to inviting of financial bid.
CCEA has also given its nod for empowering the core group of Secretaries to take policy decisions with regard to procedural issues and to consider deviations as necessary from time to time for effective implementation of decisions taken by the Cabinet.
The latest changes were proposed by the Department of Investment and Public Asset Management (DIPAM), an official statement said.
Several top notch state-owned entities including Air India, BEML and Salem Steel Plant are being lined up for strategic disinvestments this fiscal.
The CCEA had on June 28 granted in-principle approval for considering strategic disinvestment of Air India and five of its subsidiaries, including Air India Express.
In the case of Air India, a group of ministers headed by Finance Minister Arun Jaitley has already been mandated to decide on the treatment of unsustainable debt of Air India. This group will also decide the quantum of disinvestment and the eligibility criteria of bidders.
For 2017-18, the Centre’s disinvestment target has been pegged at ₹72,500 crore, of which, about ₹42,500 crore is envisaged from minority stake sale and exchange traded funds. So far this fiscal, the Centre has raised ₹9,300 crore.
Bharat-22 To help achieve the disinvestment target for the current fiscal, the Centre proposes to launch a second exchange traded fund (ETF) known as Bharat-22.
This will comprise stocks of 22-blue chip public sector units, state-owned banks and some holdings in SUUTI (Specified Undertaking of Unit Trust of India).