Arabic version: الهند تسرّع بيع حصص الشركات المملوكة للدولة
According to Cnbc, India has accelerated sales of stakes in state-owned companies, raising more than 620 billion rupees ($6.5 billion) this year after reducing holdings in 10 public sector firms. The push comes as the government seeks funds while facing inflationary pressures, fiscal constraints and a widening fiscal deficit.
On Wednesday, the government raised $3.3 billion by selling a 6.5% stake in Life Insurance Corporation of India, the country’s top life insurer. The offering was priced at a 10% discount and was oversubscribed. Excluding LIC, India had sold stakes in nine state-owned firms in 2026 and raised nearly 270 billion rupees ($2.8 billion), its highest amount in more than 10 years, according to Prime Database.
The government has sold shares in companies including Cochin Shipyard, Indian Railways Finance Corp, NHPC and Coal India. It has now achieved more than 65% of its annual target to raise 800 billion rupees ($8.4 billion) through stake sales in state-owned enterprises. The last time India met its disinvestment target was in the financial year ending March 2019.
Anubhuti Sahay, head of India economic research at Standard Chartered Bank, said the government faces downside revenue risk and upside expenditure risk from a higher subsidy burden. Alexandra Hermann Prasad, lead economist at Oxford Economics, said faster stake sales reflect greater fiscal pressure and can provide non-debt revenue as expenditure growth makes the deficit target harder to achieve.
For the quarter ending June, India’s goods and services trade deficit was $37.4 billion. Its fiscal deficit at the end of June stood at 3.1 trillion rupees, or 18.2% of the budget estimate for the financial year ending March 2027. Citi said fuel, food and fertilizer subsidies increased 37% year on year during the June quarter, while India had not reduced capital expenditure spending.
