The government will struggle to raise even half the proceeds it had targeted from planned sales of state-run firms this year and will miss divestment targets for the fifth straight year, sources said, as elections shift government priorities. The government may fall short of its divestment goal by Rs 30,000 crore ($3.60 billion) in FY 2023-24, two government sources said. New Delhi had targeted Rs 51,000 crore from divestment proceeds for the current fiscal year that ends March, 2024.
In the current fiscal, about Rs 30,000 crore of the Rs 51,000 crore target was expected through stake sales in IDBI Bank and the privatisation of state-owned NMDC Steel.
However, delays in vetting of interested buyers for IDBI by the RBI have stretched the sale timeline beyond the 2024 General Election. The sale of NMDC Steel will not conclude this year due to state elections and General Election next summer. While it may still achieve some smaller divestments in the current fiscal year, it would still be well short of half its overall target.