Cabinet approves largest-ever privatisation drive as BPCL, 4 PSUs to be sold

Finance Minister Nirmala Sitharaman announced on Wednesday that the government would sell its stake in five PSUs: Bharat Petroleum Corporation Limited (BPCL), the Shipping Corporation of India (SCI), Container Corporation of India (CCI), Tehri Hydro Development Corporation Limited (THDCIL), and the North Eastern Electric Power Corporation Limited (NEEPCO).

The government will sell its 53.29 per cent stake in BPCL after taking out Numaligarh refinery from its portfolio, Sitharaman told reporters in Delhi.

Besides, the government will sell its stake in THDC India and North Eastern Electric Power Corporation Ltd (NEEPCO) to state-owned NTPC Ltd, she said.

Finance Minister said the Cabinet has also approved cutting government's stake in select PSUs below 51 per cent while retaining management control.

The government’s disinvestment drive was part of a wider strategy to raise Rs 105,000 crore from the sale of central public sector enterprises (CPSEs), announced earlier in the year.

The sale of BPCL is likely to have ramifications for the company, as rating agency Moody’s had stated in October that it would downgrade the company’s ratings if the government’s stake in it was sold. BPCL is India’s second-largest state-owned refining and marketing company, accounting for 15 per cent of total installed refining capacity.

While normally the sale of BPCL would require both cabinet and parliamentary approval, the government had with the Repealing and Amending Act of 2016 removed the requirement for parliamentary approval.

Congress leader Rahul Gandhi had earlier opposed the sale of PSUs, in particular, that of CCI, which he called a jewel being sold to “crony capitalists”.