The government's divestment programme, which derailed following opposition from the Left parties, is set to take off again with Finance Minister P Chidambaram announcing that some profit-making non-Navratna PSUs had been identified for selling minority stakes by the end of this fiscal.
"We have identified profit-making non-Navratna companies for divestment of minority stakes. We will begin discussions (with Left parties)," he told the annual economic editors conference without giving names of the PSUs.
He said the respective ministries have to come up with the proposals for divestment of PSUs under them.
"By end of this fiscal, we hope to put some money in the National Investment Fund," he said, referring to the Cabinet decision to operationalise the NIF, income from which would be used for social sector projects and revamping PSUs.
Regarding Navratna PSUs, he admitted there were 'differences' with the Left parties. "So we have decided that we will not divest the 8 Navratna companies."
The government has already consulted Left parties in October end to take up divestment in non-Navratna PSUs for offloading a small portion of their shares in capital market.
The divestment in state-owned enterprises would be strictly as per the Common Minimum Programme.
Of the 240-odd central PSUs, only 28 are listed and most of them like NTPC have unlocked higher value after listing.
There could be several other companies like Air-India, Indian Airlines, Bharat Sanchar Nigam Ltd, National Hydro Power Corporation and Power Finance Corporation that require funds for expansion and could raise the money from the market.
The United Progressive Alliance now wants to take the Left parties into confidence before venturing into the divestment drive, after it faced major hurdles in pushing forward the divestment of Bharat Heavy Electricals Ltd.
Moves are also afoot to sell residual equity in PSUs that have already been privatised by the earlier National Democratic Alliance government.
While government has put off strategic sale of PSU shares, the public offer route is still open.
CPI(M) chief Prakash Karat had stated that his party has no problem with the public offer route to divest minority stake in companies other than Navratnas.
Karat had made it clear that CPI(M) was opposed to the divestment of Navratna companies but shares could be sold in other companies to raise resources for social sector.
He had stated that Left parties could discuss sale of shares in other PSUs. The Left was also open to the sale of unviable PSUs, as was being done in West Bengal.
Of the 240-odd central PSUs, only 8 fall under Navratna category. About 88 PSUs are in red while the rest are making profits.
With the softening of stance by the Left parties, the government is expecting less opposition to the divesting part of the shares of unlisted companies through IPO route.
The Cabinet Committee on Economic Affairs has already given its in-principle approval for listing of unlisted profitable public sector companies with a net worth of more than Rs 200 crore (Rs 2 billion).
It has also approved sale of government's minority shareholding in profitable PSUs in conjuction with a public issue of fresh equity by the company concerned or independently by the government.