<div>India is likely to sell a 5 per cent stake in both Power Finance Corporation Ltd (PFC) and Dredging Corporation of India Ltd as it races to narrow its fiscal gap to a targetted seven-year low by March, when the financial year ends.</div><div> </div><div>"Five per cent of the shares of PFC could be sold next week," a senior finance ministry official said on Friday, declining to be named as he was not authorised to speak to the media.</div><div> </div><div>The PFC share sale could fetch 18.35 billion rupees ($298 million) at current market prices.</div><div> </div><div>Prime Minister Narendra Modi aims to trim the fiscal deficit to 4.1 per cent of gross domestic product this fiscal year and to that end it wants to raise $10 billion in asset sales .</div><div> </div><div>However, finance ministry sources say it is only likely to get $4 billion to $5 billion from sales and so far it has raised a little more than $300 million.</div><div> </div><div>"Current prices are attractive to own PFC, but the government could have waited for a higher price," said G. Chokkalingam, founder of Equinomics, a research and fund advisory firm based in Mumbai.</div><div> </div><div>The state owns 72.8 per cent of the financing company, whose shares were up 0.35 per cent at 279.75 rupees at 0855 GMT.</div><div> </div><div>The share price has fallen by more than 6 per cent this year while the benchmark Sensex index has added 6 percent.</div><div> </div><div>Apart from PFC and Dredging Corp, the government has invited bids from merchant bankers this week for 10 per cent stakes in miner NMDC, Indian Oil Corp and National Aluminium Co.</div><div> </div><div>It has also called for bids for a 5 per cent share sale in engineering equipment maker BHEL.</div><div> </div><div>If all these sales materialise, India could raise more than 200 billion rupees ($3.25 billion), based on current market valuation.</div><div> </div><div>Next in line could be state-run manganese miner MOIL Ltd with a 10 per cent stake sale, the finance ministry official said.</div><div> </div><div><strong>Disinvestment Programme</strong></div><div>The government will go ahead with its disinvestment programme and "a lot of activity" is expected on that front, Finance Minister Arun Jaitley said in Davos on the sidelines of the WEF summit.</div><div> </div><div>He also said that the government's tax revenue collections have been good, although refunds for past periods are making an impact.</div><div> </div><div>On whether the government would look at privatisation as well, Jaitley said it can be done in case of companies that need to be privatised and the government cannot keep funding their losses with the taxpayers' money.</div><div> </div><div>"As far as divestment is concerned, we are committed to our divestment programme and a lot of activity is expected," he said.</div><div> </div><div>"I wont talk about the companies, as media speculations is hurting the programme as it also leads to market speculations. The media's role in divestment programme has been highly speculative and these speculations lead to market speculations," Jaitley said.</div><div> </div><div>On privatisation, he said, "Those would be the companies that are not doing well and therefore today the government can not keep taxing people in order to fund losses year after year."</div><div> </div><div>(Agencies)</div><div> </div>
