India official: Hope to complete IDBI stake sale by Oct

India official: Hope to complete IDBI stake sale by Oct

India's government is optimistic about completing the strategic sale of its stake in IDBI Bank by October. The move is part of the broader divestment strategy aimed at raising funds and reducing the government's fiscal burden. A key government panel is set to review the Share Purchase Agreement (SPA) for the sale, which is a crucial step in the process [2].

The government has been delaying the sale due to various reasons, but it is now nearing the final stages. According to sources, the Inter-Ministerial Group (IMG) will review the SPA and other related matters. Following this, the Core Group of Secretaries on disinvestment will vet the proposal before it is sent to the ministerial panel for final approval [2].

The government is eyeing a significant amount from the IDBI Bank disinvestment, with estimates ranging from Rs 40,000 to Rs 50,000 crore. The sale of the government's stake in IDBI Bank has been delayed multiple times over the past three years. Currently, the government and Life Insurance Corporation of India (LIC) jointly own 95 per cent of IDBI Bank, with 60.72 per cent earmarked for sale [2].

The privatization of IDBI Bank has sparked concerns among employees and political leaders. Employees have expressed fears about job losses and precarious service conditions if the bank is privatized. Rajya Sabha MP Bonoy Viswam has urged the government to reconsider the decision, highlighting the bank's public character and the assurances given by the NDA government in 2003 [3].

The government's decision to privatize IDBI Bank is part of a broader trend of selling stakes in public sector banks. The sale of IDBI Bank is expected to be concluded within the current financial year, with financial bids likely to be invited in September [2].

References:
[1] https://www.financialexpress.com/business/banking-finance-idbi-bank-sale-moves-forward-govt-panel-to-meet-review-share-purchase-agreement-3905508/
[2] https://www.nationalheraldindia.com/india/reconsider-move-to-privatize-idbi-bank-rs-mp-viswam-urges-centre-employees-hit-streets-during-bharat-bandh