The government is planning to sell its stake in SJVN Ltd and Power Finance Corporation to NTPC and Rural Electrification Corporation, respectively, with an aim to rein in India's fiscal deficit
New Delhi: India is planning to sell its stake in SJVN Ltd and Power Finance Corp. to other government-controlled companies in deals that may fetch the federal government about ₹ 20,000 crore, helping it to rein in the fiscal deficit amid growing risks of a slippage, people with knowledge of the matter said.
“This is disinvestment by proxy," Amit Mantri, founder of 2Point2 Capital Advisors, said by phone. “By selling stake in one state-run company to another the government can claim to have monetized its stake. But this is only an optical reduction in fiscal deficit."
Finance ministry spokesman D.S. Malik didn’t answer two calls to his phone. Modi’s government has only raised ₹ 9,200 crore so far from asset sales, compared to a target of ₹ 80,000 crore for the fiscal year ending 31 March.
Bloomberg’s Santanu Chakraborty contributed to this story.
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