June 16, 2021 3:44:36 am
The Union Cabinet is set to take up a proposal to permit 100 per cent foreign direct investment (FDI) in state-owned oil refiners to clear the regulatory path for the privatisation of Bharat Petroleum Corporation Ltd (BPCL), according to government officials.
The move, initially proposed by the Petroleum Ministry, will be placed before the Cabinet by the Department of Promotion of Industry and Internal Trade (DPIIT). The divestment of the Centre’s 53 per cent stake in BPCL is a key part of the former’s disinvestment target of Rs 1.75 lakh crore for FY22.
“If you are asking foreign players to bid, then it is natural to permit 100 per cent FDI,” said a government official. Once cleared, the proposal will no longer require a successful foreign bidder for BPCL to seek approval from the government. There are currently three players vying for BPCL, including Anil Aggarwal’s Vedanta group, and private equity firms Apollo Global, and I Squared Capital’s arm Think Gas. Current FDI regulations only permit 49 per cent FDI in public sector petroleum refiners.
The official noted that while current regulations permit 100 per cent FDI in private sector refining, a clarification would be required since BPCL is also a retailer of petroleum products.
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