It is interesting to see that Finance Minister Arun Jaitley is still confident of meeting the 4.1% target of fiscal deficit by the end of March 31, 2015.
On December 5, 2014 the Narendra Modi government, under the auspices of Finance Minister Arun Jaitley began on a disinvestment programme targeting to raise a mammoth $7 billion by March 31, 2015.
It's been nearly two months since the 5% stake-sale in state-owned steelmaker SAIL that fetched Rs 1,700 crore ($275 million) and the cash registers have gone mum.
It is interesting to see that Finance Minister Arun Jaitley is still confident of meeting the 4.1% target of fiscal deficit by the end of March 31, 2015.
He is pegging the revival in the manufacturing sector to achieve this fiscal deficit target of 4.1%. How he will reach this target without plugging the fiscal deficit gap by way of disinvestment remains to be seen.
There have been talks that very soon, disinvestment of Indian Oil, Power Finance Corporation and Rural Electrification Corporation will begin, but little has moved on the ground so far.
The government is looking to sell 10% shares in Indian Oil Corporation (IOC) for an approximate $1.3 billion.
Moreover, 5% share-sales in PFC and REC each are likely to get not more than Rs 4,000 crore, or less than $1 billion.
The above three, however, are not originally first companies that were chosen by the government to offload its stake. Those were big tickets ONGC, Coal India and NHPC.
The Coal India disinvestment programme was supposed to get nearly $3 billion to the government's kitty, or Rs 19,000 crore. But the Coal India labour unions' strike forced the government to delay the stake-sale.
ONGC was slated to fetch Rs 17,500 crore, or $2.8 billion. The government is still keen on ONGC and has said that the stake-sale will go ahead in the current fiscal but the drop in its market cap will fetch no more than Rs 15,000 crore.
Therefore, the government is readying smaller PSUs for stake-sales.
Other companies lined up for anything between 5-10% stake-sales include Nalco and BHEL Ltd, among others.
However, it is clear that by no means can the government achieve to raise Rs 41,000 crore in two months without Coal India and ONGC share-sales.
Moreover, the initial target of $9.5 billion or Rs 58,425 crore is already scaled down to Rs 43,425 crore as Hindustan Zinc and Balco stake-sale of Rs 15,000 crore cannot happen in the current fiscal.
This leaves the government with a target to raise nearly Rs 41,000 crore, or over $6.5 billion, in just about 60 days.
Will it scale down its targets one more time or will the Modi government be able to raise nearly Rs 660 crore every single day from today till March 31, 2015?
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