Indian Government to privatize 5 to 6 companies
Team Ambitiousbaba and AB are here with a Current Affairs Special Series. In this series, candidates will be introduced to current affairs topics daily, which will not only improve their general awareness but also will ensure that the candidates do not lack in any current affairs topic. Today’s Current Affairs topic is “Indian Government to privatize 5 to 6 companies”
Government of India is going to privatize five or six companies within the current fiscal year of 2021-22, including Bharat Petroleum Corporation Limited, Shipping Corporation of India and Pawan Hans, said DIPAM Secretary Tuhin Kanta Pandey.
DIPAM Secretary also said that the government is going to invite bids for privatisation by December-January for the above mentioned companies. Speaking at Confederation of Indian Industry (CII) Global Economic Policy Summit 2021 on November 17, Pandey said that he also expects to over the procedure of privatisation of BEML and Neelachal Ispat by 2021-22.
What is DIPAM?
DIPAM is a short form of the Department of Investment and Public Asset Management which comes under the Finance Ministry. Its role is to privatize PSUs or take them public through initial public offerings, and cast stake in listed PSUs through offer-for-sales. The department also supervises dividends paid and share buybacks by PSUs.
DIPAM’s role is most important for this year due to the centre looks to achieve an ambitious divestment target of Rs 1.75 lakh crore. Having already successfully executed the sale of Air India to Tata Sons, Pandey’s task for the rest of the year is to privatize BPCL and LIC IPO. Department of Economic Affairs Secretary Ajay Seth, who also spoke at the event, said: “We should attempt to increase capital expenditure in India to settle around 10 percent of the country’s GDP over the next few years.”
As the government drives to list the initial public offering (IPO) of LIC, the government is solving very hard for it and expects to launch it in the fourth and last quarter of 2021-22.
Capital markets aren’t mature enough to give long-term finance and there is a need to further develop them for long-term financing.
To set the context, compared to more than 800 listed REITs globally with a combined market capitalization of $2.4 trillion, the product is still in its early days in India.
Three listed REITs in India which has the market capitalization of $4 billion and the total capitalization of all listed and private InvITs in the country is approximately $10 billion.
Question & Answer:
Q1. Who is the secretary of Department of Investment and Public Asset Management?
Ans. Shri Tuhin Kanta Pandey (Dr. Dheeraj Bhatnagar – Additional Secretary)
Q2. Which companies would be privatized in the current financial year?
Ans. Five to Six companies would be privatized which are: BPCL, Shipping Corporation of India, Pawan Hans, Life Insurance Company of India, Neelachal Ispat and Bharat Earth Movers Limited (BEML).
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