After months of deliberations, the government on Monday decided to sell its residual stake of 29.5 per cent in Hindustan Zinc Limited, a Vedanta Group company, which could fetch the exchequer about Rs 17,000 crore.
However, the government is learnt to have deferred its decision on selling 49 per cent stake in Balco, which could have enriched the exchequer by over Rs 3,500 crore. The Cabinet Committee on Economic Affairs (CCEA), which met under the chairmanship of Prime Minister Manmohan Singh, today vetted the mines ministry’s proposal to sell its residual stake in HZL after deliberating at length on the possible legal implications of the sale.
The proposal for residual stake sale in Balco is expected to be taken up at the next meeting of the CCEA, said a person privy to the development.
- Varun Gandhi Under Attack Over Defence Deals: Here’s How
- This Diwali, Let Blind Students Brighten Up your Homes With Candles & Diyas
- CBI Files Supplementary Chargesheet In Sheena Bora Murder Case
- Soha Ali Khan And Vir Das Starrer 31st October Audience Reaction
- Sahara Chief Subrata Roy’s Parole Extended Till November 28
- Simple Tips To Secure Your Debit Card From Fraudsters
- New Zealand & India Team Being Welcomed In Chandigarh
- Mumbai Call Centre Scam: All You Need To Know
- Jammu Kashmir Chief Minister Mehbooba Mufti Appeals To Police: Here’s What She Said
- Shocker From Ahmedabad: Find Out What Happened
- Bigg Boss 10 Day 3 Review: Celebs Fail To Do Well in First Task
- Airtel Offers 10GB Data At Rs 259 For New 4G Smartphone Users
- Aamir Khan Starrer Dangal’s Trailer Launched: First Impressions
- TMC Supporters Attack BJP Leader Babul Supriyo
- Sri Lankan Navy Apprehends 20 Indian Fishermen
It is learnt that Attorney General GE Vahanvati was invited to the CCEA meet to explain the legal issues in the aftermath of the stake sale. It was Vahanvati who had last week cleared the decks for enabling the government to sell its stake in HZL, notwithstanding a CBI inquiry into the earlier disinvestment process in the company.
Last month, a meeting chaired by the Prime Minister, also decided that the remaining stake would be sold through open auction rather than selling it to Vedanta Group. However, the meeting decided to solicit Vahanvati’s opinion through the mines ministry before taking a final decision.
In the case of Balco, Vahanvati has backed the mines ministry’s note to sell it through the offer of sale route.
The HZL stake sale is expected to give a breather to the cash strapped government, which is struggling to contain its fiscal deficit at 4.8 per cent of the GDP. While tax collections have remained muted, the estimated Rs 40,000 crore from disinvestment proceeds has also not been met.
Against a budgeted Rs 54,000 crore from stake sale – Rs 40,000 crore in state-run companies and Rs 14,000 crore from residual stakes- the government has so far managed only about Rs 3,000 crore.
It had to settle for special dividends from cash-rich PSUs like Coal India and NMDC Limited owing to firm opposition from their employees and also partially due to sluggish market conditions.
The other disinvestment options are stake sale in Axis Bank and Rs 5,000 crore from acquisition of 10 per cent government stake in Indian Oil by ONGC and Oil India.