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Indian Government Raises $1.98 Billion from Stake Sales in State-Run Companies in 2023-24

Indian Government Raises $1.98 Billion from Stake Sales in State-Run Companies in 2023-24

1 April 2024 – The Indian government has garnered 165 billion rupees ($1.98 billion) in 2023/24 through stake sales in approximately 10 state-run companies, according to official data. This figure falls short of the internal target of 180 billion rupees, reflecting a 9% deficit.

Despite Prime Minister Narendra Modi’s privatization aspirations for state-run firms, the government’s stake sale efforts were hindered by the upcoming general elections commencing on April 19. The stake sale proceeds amounted to 165 billion rupees, slightly below the target but showcasing the government’s commitment to divesting its holdings.

Modi’s government has achieved its privatization and minority stake sale targets only twice in the past decade. However, its performance in this regard surpasses that of previous administrations. Notably, the government has refrained from setting a specific target for the current financial year, signaling a departure from conventional practices.

While stake sale receipts fell short of expectations, the government received higher dividends from state-run companies, totaling around 630 billion rupees in 2023/24. This figure exceeds the target of 500 billion rupees, helping to offset the deficit from stake sales.

The shortfall in stake sale proceeds underscores the challenges faced by the government in meeting its privatization objectives amidst broader political dynamics. However, the higher dividend receipts provide a financial cushion and reflect the continued profitability of state-run enterprises.

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