Axis Bank-type stake sale an option for IDBI Bank: Government

Mumbai, Oct 27 (IANS) The government said on Tuesday it was looking at divesting stake in the public sector IDBI Bank, on lines similar to what it done in the case of Axis Bank.

“We still have quite number of opportunities even on divestment side. We will consider transforming IDBI Bank in a manner similar to the way Axis Bank was done. We have opportunities there as well,” Minister of State for Finance Jayant Sinha said at an investment meet here.

The government sold its remaining 9 percent stake in Axis Bank last year for Rs.5,500 crore. Erstwhile state-run entity UTI was earlier the main stakeholder in Axis Bank.

Sinha also blamed the slump in global commodities for the slow pace of government divestment.

“One of the reasons why the divestment process is challenging right now is because many of the companies we are considering for divestment are in the commodity industries,” he said.

“Whether it is Coal India or OMCs (oil marketing companies) and so on. They are impacted by global commodity prices,” he added.

In the current fiscal, the government has been able to sell stake only in four undertakings — PFC, REC, Dredging Corp and Indian Oil — to garner Rs.12,600 crore, as against the full year disinvestment target of Rs.69,500 crore.

The government has in the divestment pipeline for the fiscal over 20 companies for which it has obtained cabinet approval. These include, 10 percent stake sale each in Oil India, Nalco, NMDC and Coal India and a 5 percent each in NTPC, ONGC, BHEL.

Regarding overall revenue collection, the government was confident of meeting the year’s tax collection targets.

“On the tax side, we are very close to all our targets. Direct taxes are down somewhat… indirect taxes are doing very well. As far as taxes are concerned, we are in a good position,” Sinha said.

“With respect to divestment and non-tax revenues, we will have to see how they balance themselves out,” he added.

Related Posts

Leave a Reply