Government picks two steel companies for disinvestment

Showing signs that the disinvestment agenda remained very much on the cards of Manmohan Singh’s Cabinet, India’s union steel minister Virbhadra Singh said on Friday that the government had identified two state-run steel companies for disinvestment. The minister, however, refused to name the companies.

The government is already understood to have cleared the name of NMDC ((National Mineral Development Corporation) for selling little over 8% stake sale. A proposal in this regard had been sent to the Union Cabinet by the steel ministry. Another disinvestment where decision is nearly final is an unlisted entity MOIL (Manganese Ore India).

The UPA government had made its intentions clear after the elections that it would go ahead with stake sale in state controlled companies to bring revenue required for infrastructure projects. However, in wake of lack of consensus on the subject, the government may take the easier route of listing the unlisted entities which will require a 10% stake sale naturally to fulfil stock regulator’s requirements.

While in the Union Budget for FY2009-10, the finance ministry had put the total disinvestment proceeds for the fiscal at a meagre figure of Rs 1,120 crore, finance minister Pranab Mukherjee has clarified later that the government would go ahead with the disinvestment agenda and firms on the radar would be named going forward.