India's Finance Minister Nirmala Sitharaman said that the government plans to wrap up sale Air India and Bharat Petroleum Corporation Limited (BPCL) by March 2020. “We are moving with the expectation that we can complete the sale this year. The ground realities will play out,” she said in an interview, while referring to the strategic sale of the two state-run companies, a crucial part of the government’s plan to raise over £10 billion in the current fiscal year.
Sitharaman also said there is a “lot of interest” among investors as evident in international road shows ahead of the sale of Air India, contrary to a tepid response received during the bidding process a year ago. The sale of the two state-owned companies could provide a cushion to the government as it struggles to cope with one of the steepest demand slowdowns in the last few decades. The government is banking on receipts from disinvestment – comprising strategic sale and public offers – to shore up revenues in a year when tax collections are under pressure. The minister also said the government took measures to reverse the economic slowdown at the right time and several sectors are coming out of distress. The finance minister also said industry captains had helped improve their balance sheet and many of them were planning fresh investments.
On taxation, she expected Goods and Services Tax collections to bounce back citing improvement in some sectors and recent steps taken to provide a boost to the ailing economy. Sitharaman also said the Supreme Court judgment on Essar Steel had established constitutionality and legal strength of the IBC law and would have a huge impact on the balance sheets of banks in the next quarter. She said there were signs of a revival in consumer sentiment, which was manifested in demand of nearly £18 billion in loans from banks at the outreach programme during the festival season. “If consumer confidence is not on way to being restored, why would you think that such an amount would have gone out as loans during the two outreach programmes started by banks? And, it is all over the country,” said Sitharaman.