Privatization of the PSUs will now be resumed by the Government of India and about four unmerged banks and insurance companies will be privatized in the next part of the project.
The privatization of PSU Banks was postponed in 2020 due to the outbreak of the Coronavirus pandemic, which put the whole process on hold because of their low valuations and mounting stressed assets.
As per reports, Punjab & Sind Bank, IOB, Bank of Maharashtra might be privatized, along with state-run insurance companies, such as National Insurance Company, United India Insurance, and Oriental Insurance Company.
Prior to this, the Government had also sold their shares in the Bharat Petroleum Corp Ltd (BPCL), Shipping Corp of India (SCI), THDC India, and NEEPCO. The Govt also announced that it will also sell its 30% stake from the state run rail hauler Container Corp of India (Concor).
Recently, the Government of India had also announced economic reforms in wake of the Coronavirus pandemic, wherein it was declared that every PSU in India will be now privatized, except 4 in strategic sectors.
As per reports, a draft cabinet note has already been sent for inter-ministerial consultations to identity strategic and non-strategic sectors.
A government official close to the development said, “A broader policy will look at sectors that have market imperfections due to the government’s presence, where the private sector can take the lead and ensure that the monopoly should not happen due to state-run companies.”
He also said that sectors like banks, insurance, space, defence will be privatized.
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