India plans state asset sale to raise $11bn

NEW DELHI: The Indian government is likely to seek to raise about 800 billion rupees ($11.21bn) through the sale of state-owned assets in the next fiscal year, beginning April 1, two government sources with direct knowledge of budget discussions told Reuters on Tuesday.The target, which is the same as for the current financial year, includes proceeds from the expected privatisation of loss-making national carrier Air India, and the sale of an insurer to be created by the merger of three state-owned firms, the sources said. It will also involve the sale of units in an exchange traded fund consisting of minority stakes in about 20 state-owned companies, they said.Finance Minister Arun Jaitley, who is currently in the United States for a medical check-up, is expected to announce the target while presenting an interim budget on Feb. 1, said one of the sources.The government could also sell shares in a number of state-owned companies through initial public offerings, the sources said. Possible candidates for these include Telecommunications Consultants India, Indian Railways’ subsidiaries IRCTC, RailTel Corporation India and National Seeds Corporation (NSC), they added.The government has proposed merging three state-owned general insurance companies National Insurance, Oriental Insurance and United Insurance – and then listing the single entity.The government failed to attract bidders for Air India when it tried to sell a majority stake in 2018. But the airline is now being restructured and to make it more attractive just over half of its debt will be placed in another company and will not be part of any future sale, one of the sources said.

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