According to a budget paper released by the finance ministry, the government has set a target of Rs 51,000 crore through the divestment pathway for the fiscal year 2023-24. The move aligns with expectations against unfavourable market conditions and a slow privatisation process in 2022.

In FY23, the government budget raised Rs 65,000 crore through divestment. The revised divestment estimate for FY23 is Rs 50,000 crore.

So far, the government has raised just Rs 31,000 crore in FY23 by selling its stakes in public sector businesses and will miss its annual target as there won’t be any significant divestments until March 31. Most of the Rs 31,000 crore fund came from the landmark LIC IPO, which raised Rs 21,000 crore in May 2022.

According to a recent report by Goldman Sachs, divestment income has been below budget estimates for the past eight years except for FY18 and FY19. In FY21 and FY22, the government achieved only 18% and 8% of its divestment targets, respectively.

Companies on the Mod regime’s divestment list for the past few years include BPCL, Shipping Corporation, BEML, Concor, HLL Lifecare and NMDC Steel Ltd.

Brokerages had predicted that the government was unlikely to aggressively pursue a divestment agenda due to the 2024 general election.

The government and LIC want to sell a 60.72% stake in IDBI Bank and invited bids from potential buyers in October. The last date to submit expressions of interest (EoIs) or preliminary bids was set for December 16, which was later extended to January 7.