Arunish Chawla, Secretary in the Department of Investment and Public Asset Management (DIPAM)
In a world rattled by geopolitical tensions and trade wars, India is taking no chances, with the Department of Investment and Public Asset Management (DIPAM) intensifying its oversight of public sector undertakings (PSUs) through weekly capital reviews to ensure these giants remain insulated from global shocks.
Arunish Chawla, Secretary of DIPAM, revealed that the government is crafting robust strategies to protect the domestic economy.
“PSUs account for 15% of India’s market capitalisation. Their sustained capital expenditure is non-negotiable for growth,” he emphasised.
This comes as US tariff policies cast a shadow over emerging markets, prompting India to double down on self-reliance.
LIC and Beyond: Merchant Bankers Roped In for Strategic Stake Sales
The government is also advancing its disinvestment agenda, appointing merchant bankers for potential stake sales in key financial institutions, including the Life Insurance Corporation (LIC).
While Chawla remained tight-lipped on timelines, he confirmed that these bankers will oversee transactions over the next three to five years.
LIC, where the Centre holds a commanding 96.5% stake, may see an offer for sale later this year. This move aligns with India’s broader vision of unlocking value in state-owned assets while maintaining fiscal discipline.
IDBI Bank Privatisation: A Defining Moment for India’s Disinvestment Story
All eyes are now on IDBI Bank, as its long-pending privatisation enters the home stretch.
After three years of delays, the process has crossed critical milestones: due diligence is complete, data rooms are operational, and consultations with bidders have concluded.
Chawla announced that financial bids will be invited by Q3 FY26, with a winning bidder likely to be announced by March 2026.
The sale includes a 60.72% stake—split between the government (30.48%) and LIC (30.24%)—along with management control. This transaction, part of India’s ₹47,000 crore disinvestment target, could redefine the landscape of the banking sector.
Market Jitters and Strategic Calm
While IDBI Bank’s shares dipped 2.68% amid broader market volatility, the government remains unfazed.
The Reserve Bank of India’s ‘fit and proper’ clearance for bidders adds a layer of confidence to the process.
Chawla’s reassurance comes at a precarious time: US tariffs on Indian goods and global equity downturns have spooked investors. Yet, India’s focus on strategic disinvestment and PSU resilience signals a deliberate pivot toward long-term stability.
The Road Ahead: Flexibility Over Rigidity
Gone are the days of rigid disinvestment targets. The new mantra is strategic outcomes. Whether it’s shielding PSUs from external shocks or navigating the complexities of IDBI Bank’s sale, India is opting for agility over dogma.
As Chawla put it, “Individual transactions can happen anytime.” In a world of uncertainty, India’s economic playbook is writing its own rules.
India’s Economic Resilience Amid Global Turbulence
In the high-stakes game of global economics, India is playing both defence and offence, fortifying its PSUs while accelerating strategic exits.
The weeks ahead will test this balancing act, but the groundwork suggests a nation preparing to turn challenges into opportunities.
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