The government's selling spree is on full swing with the LIC IPO being doled out soon, and to ensure its success the Govt has even tweaked some part of the FDI policy
https://www.moneycontrol.com/news/business/ipo/lic-ipo-drhp-likely-this-month-20-fdi-cap-being-proposed-7936841.html JANUARY 14, 2022 To facilitate disinvestment of the country’s largest insurer, the commerce and industry ministry has introduced some changes in the foreign direct investment (FDI) policy
"The clearance for foreign stakes in the mega offering would not just permit global funds to participate, but also allow them to buy more after the exchange listing. Regulators made other moves late last month, including tightening rules governing share sales by anchor investors." The success of the public issue is crucial for the government to inch closer to its Rs 1.75-lakh-crore divestment target for the fiscal 2021-22. So far, only Rs 9,330 crore has been mopped up through PSU stake sale.
(comment in Finance Matters, cenfa.org.. the question remains, does India need to sell its golden goose? There are several lessons to be learnt from the previous roll-out of National Monetization Policy. At the same time, huge funds continue to be pumped into various schemes, the latest being the ADB's 350 million loan to AMRUT 2.0. It is high time we prioritise what the country really needs, see beyond the rhetoric and listen to the demands of its huge young population facing massive nemployment, inflation and rapidly being pushed to poverty
Selling the Golden Goose for a Pittance – Does our FM know what LIC is? By Thomas Franco | January 15, 2022 LIC is a golden goose which is giving golden eggs regularly to the economy, development projects and providing social security to the majority of the marginalised people of this country. Almost one third of the GDP is connected to LIC and almost one third of the budget of the GOI is financed by LIC. The FM has stated that the listing would bring discipline while giving retail investors an opportunity in wealth creation. She doesn’t say where the indiscipline is. It is her Ministry which is overseeing LIC and her Secretary is on the board of LIC. The so called retail investors in India are not even 3% to whom she wants to give wealth.
There is so much talk of efficiency of the private sector. The IRDAI Annual Report for 2020-21 has shown that the operating expense of LIC is 8.68% of the total premium income. The same for private sector is 11.72%. LIC has been serving larger number of policies at an economical cost.
All this will go away with privatisation. Shareholders will only insist on more profit ignoring the social security needed for the larger majority.
<https://www.downtoearth.org.in/blog/governance/covid-19-a-generation-interrupted-80945>