GoI is pushing ahead with the sale of its residual stake in Hindustan Zinc, which could make a sizeable contribution to this year's disinvestment target after the lower-than-expected proceeds from the LIC listing. It also intends to put Shipping Corporation of India (SCI) on the block despite delays over hiving off its non-core assets. The LIC IPO, originally scheduled for 2021-22, set back the divestment proceeds for the year. This led to the government missing even its revised disinvestment target of ₹78,000 crore, a pale shadow of the original ambition of raising ₹1.75 lakh crore. Disinvestment receipts have missed reduced revised estimates in two of the four preceding years, and this year's budget estimate is a more prudent ₹65,000 crore.
The difficulties in accomplishing strategic sales is a matter of concern. This route should ideally be more acceptable to buyers who might be wary of boarding state-run enterprises as minority shareholders. LIC's stock price has been trending down since listing in an indication of the market's perception of government influence in managerial decision-making. It is vital that the privatisation pipeline finds viable takers. Lowering disinvestment ambitions not only affects government finances but it also blunts competition in the economy.