Covid surge likely to impact the progress on strategic disinvestment, privatization programme

As per sources who told a leading business daily, the surge in coronavirus cases across the country is likely to impact the progress on strategic disinvestment and privatisation programme during this fiscal, which could further delay the sale of the government’s stake in companies such as Bharat Petroleum Corporation Limited (BPCL) and Shipping Corporation of India (SCI).

Privatization of two nationalised banks and a government-owned general insurance company could also be impeded. Officials also indicated that the initial public offering (IPO) of LIC may see some delay.

The privatisation of two state-owned banks and one non-life insurance company that was previously announced could also be pushed back, the report said. The process of privatisation would include passing legislation and attracting investors through roadshows, which has not been done yet, the report said.

The complex valuation of Life Insurance Corp of India could also lead to delay, as physical inspection of its assets has become difficult due to the surge in COVID-19 cases, the report said. The lag in valuation may hinder the expected listing in Oct-Dec, and the target could be revised, according to the report. The public listing was scheduled for the previous financial year, before being impeded by the first wave of the COVID-19 pandemic. The Centre has budgeted 1.75 trillion rupees in expected receipts from divestment in April March 2021-22.

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