Reuters | Fri May 28, 2010 | 4:26pm IST
Volatile stock markets have not changed government’s plans to sell stakes in state-run companies, a senior finance ministry official told Reuters on Friday. The government has pencilled in proceeds of roughly 400 billion rupees ($8.6 billion) from sales in government companies in the fiscal year that began on April 1. "We are going ahead with all the preparations. And we don’t have any issue coming up till July," Disinvestment Secretary Sumit Bose said in an interview.
Shares skidded to their lowest close in three-and-a-half months early this week, before paring losses, as Europe’s sovereign debt woes sparked worries of larger foreign fund outflows and casting doubt over the government’s ability to complete its stake sale plans. Foreigners have withdrawn $2.3 billion from Indian equities so far in May in their biggest pullout since October 2008. "Let’s cross that bridge when it comes," he said, when asked whether the volatility in the equity market would prompt the government to defer its stake sale plans.
He also said the government had not decided yet to sell stakes in state-run oil marketing companies including Indian Oil Corp. "First of all, Ministry of Petroleum has to take a call on that. It is too early to talk about it," he said. "Once there is some sort of agreement in the Ministry of Petroleum, then we can," he said. In March, Bose had told Reuters that the government would review the possibility of stake sales in state oil marketing firms in 2010/11. Media reports said state-run Indian Oil Corp would be one of the companies in which the government would look to sell a stake in the current fiscal year.