IN THE SLOW LANE

DESPITE EFFORTS, THE GOVERNMENT'S DISINVESTMENT AGENDA HAS HAD MIXED SUCCESS WITH MINORITY SHARE SALES TAKING PRECEDENCE AND STRATEGIC DISINVESTMENT REMAINING ON THE BACK BURNER

- SURABHI

DISINVESTMENT. THIS WORD has proved to be a challenge for successive governments. Divesting government equity in public sector enterprises (PSE) has proven to be quite volatile even for the BJP-led NDA government over the past nine years, despite a handful of mega transactions like the privatisation of Air India and public listing of Life Insurance Corporation of India (LIC).

The government's disinvestment strategy has been quite comprehensive, including not just listing and minority stake sales through offer for sale (OFS) and buyback of shares but also strategic sale or privatisation in identified sectors, monetisation of noncore assets as well as closure of those firms that are no longer viable-such as Scooters India. Despite that, the transactions have been fewer in number and smaller in scale. As many as 159 disinvestment transactions have taken place in the last nine years, government data reveals. In terms of strategic sales, the Union Cabinet gave in-principle approval to 36 cases of PSEs, subsidiaries and joint ventures since 2016. But of the 33 cases being handled by the Department of Investment and Public Asset Management (Dipam), strategic disinvestment transactions have been completed in only 10, including the privatisation of Air India.

"About 14 transactions are at various stages," Minister of State of Finance Bhagwat Karad had informed the Lok Sabha in July this year. But given the government's mandate with more than 300 seats in the Lok Sabha and its public intent towards strategic sales and disinvestment, expectations were high.