The government has canceled the current Expression of Interest (EoI) process for privatization of BPCL, which was termed as India’s biggest ever, as most of the bidders expressed “inability to continue with the current process of disinvestment of BPCL”. ” is expressed. A notification by DIPAM. The government had planned to sell its entire 52.98 per cent stake in Bharat Petroleum Corporation Limited (BPCL) through strategic disinvestment.
“Several Covid-19 waves and geopolitical conditions affected many industries globally, especially the oil and gas industry. Due to the prevailing conditions in the global energy market, most of the QIPs have expressed their inability to continue with the current process of disinvestment of BPCL,” the Department of Investment and Public Asset Management (DIPAM) said in a notification issued on Thursday.
DIPAM also said that immediately after the invitation of the EoI, the date for submission of EoI was to be extended several times due to the COVID-19 pandemic, to remove the hurdles faced by the potential bidders. “In response to the invitation, a number of EoIs were received from interested parties. Qualified Interested Parties (QIPs) had initiated proper investigation on the company.
“In view of this, based on the decisions of the Alternative Mechanism (Empowered Group of Ministers), the Government of India Ltd. has decided to discontinue the existing EOI process for strategic disinvestment of BPCL and the EOIs received from the QIP shall stand cancelled. A decision on restarting the strategic disinvestment process of BPCL will be taken at an appropriate time based on a review of the situation,” the notification said.
As per a PTI report quoting an official, “We need to go back to the drawing board on BPCL. There are issues in terms of union formation, geopolitical situation and energy transition aspects. The official also said that the transition towards green and renewable fuels has made privatization difficult in the current terms.
Last month, Vedanta Resources Chairman Anil Agarwal had also said that the government had decided not to go ahead with the Bharat Petroleum Corporation Limited (BPCL) privatization plan and told its customers that it would revise the plan and market it. Will come Vedanta Group, Apollo Global Management and private equity major I Squared Capital-backed Think Gas were the interested buyers in the company.
The government invited expressions of interest from bidders in March 2020 for selling BPCL and at least three bids had come in by November 2020.
According to the Union Budget documents, the central government has set a disinvestment target of Rs 65,000 crore for the current fiscal year 2022-23. For the financial year 2021-22, it had set a disinvestment target of Rs 1.75 lakh crore in last year’s budget. Out of this, only Rs 78,000 crore could be received, which is a shortfall of 55.4 per cent.
In last year’s Budget Speech 2021, Finance Minister Nirmala Sitharaman had said, “We have strategically placed four sectors where there are minimum CPSEs. [central public sector enterprises] will be retained and the rest will be privatized. ,
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