Modi government pushes ahead with IDBI Bank stake sale and new PSU listings
The Union Cabinet approved selling over 30% of IDBI Bank, targeting a disinvestment receipt of more than ₹26,500 crore, while planning listings for IIFCL, MCL and SECL.
The cabinet’s decision to offload more than a third of IDBI Bank’s equity aims to secure a disinvestment cash inflow exceeding ₹26,500 crore, helping the Modi administration surpass its ₹80,000 crore target for the fiscal year 2026-27. This move signals a revival of the privatisation agenda that had stalled after the 2021 strategic disinvestment policy. The finance ministry also plans to list three PSUs - India Infrastructure Finance Company Ltd, Mahanadi Coalfields Ltd and South Eastern Coalfields Ltd - with IIFCL’s IPO expected to add to the receipts before March 2027.
Historically, privatisations such as Air India, Ferro Scrap Nigam, Neelachal Ispat Nigam and Indian Medicines Pharmaceuticals Corporation have generated only ₹2,818.73 crore, a tiny fraction of total disinvestment proceeds. Analysts note that disinvestment receipts have been eclipsed by PSU dividend income and rising government equity and loan support, suggesting a shift in fiscal strategy. Monitoring the balance between receipts from asset sales and ongoing equity injections will be crucial to assess the policy’s future direction.
