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Govt committed to Shipping Corp sale: Minister

Union Shipping Minister Ved Prakash Goyal said on Friday the government remained committed to privatisation, including selling a strategic stake in state-run Shipping Corp of India, the nation's largest shipping line.

"Several apprehensions on the divestment of public sector undertakings including SCI have been reported in the press," Goyal said in a statement.

"Therefore I want to take this opportunity to clear all doubts about the government's commitment towards the policy of divestment," he said.

He, however, admitted that no time frame has been fixed for SCI sell-off.

"You can't fix a timeframe (for privatisation). You have to get the best value and overcome perception problems. I can't say if 3-4 months would be enough. Even Department of Divestment can't set a timeframe," Shipping Minister Ved Prakash Goyal told a news conference in New Delhi.

Though the suitors for the government's 51 per cent stake in SCI have completed two rounds of due diligence, no fixed time-table for calling of financial bids has been finalised, he said.

On Thursday Defence Minister George Fernandes called for a "mid-term review" of India's privatisation drive, which has been hobbled by delays stemming from opposition within the ruling coalition and outside.

Goyal said three potential bidders had completed due diligence for SCI, which has 40 per cent of India's shipping tonnage. Initially there were 10 bidders in the fray for SCI.

"The transaction documents are under finalisation and the price bids will be called thereafter," he said.

The government holds 80.12 per cent in SCI and plans to shift management control through sale of 51 per cent of the equity to a strategic partner. It will cut its stake to 26 per cent.

The government's sell-off drive hit a roadblock in September when it delayed sales of stakes in two oil firms, Hindustan Petroleum Corp and Bharat Petroleum Corp, for three months due to rifts within the Cabinet.

India has said it hopes to raise Rs 12,000 crore (Rs 120 billion) through sales in state-run firms in the fiscal year ending March. But Divestment Minister Arun Shourie has said the cash-strapped government will likely miss the target, which is bad news as India grapples with its worst drought in 15 years.

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