Public public partnership

With LIC losing over R5,000 crore in mark-to-market terms in just three of its big-ticket purchases of PSUs since February 2010—R986 crore in NTPC, R2,659 crore in NMDC and R1,525 crore in ONGC—the government needs to relook its strategy of getting LIC to step in to pick up PSU shares when all else fails. LIC has bought around 40-45% of this year’s disinvestment so far, and we haven’t even traversed a 40th of the distance so far—Hindustan Copper’s divestment was for just R800 crore as compared to the R30,000 crore target—so there’s a lot more of PSU divestment that LIC may be called in to rescue.

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