IDBI Bank Disinvestment: Second Bidding Round Adds ₹3,917 Crore
The Finance Ministry defended the IDBI Bank disinvestment process, stating that the government followed due procedure amid questions over the transaction’s valuation.
The second round of bidding added approximately ₹3,917 crore to the transaction value, while the reserve price remained unchanged. On October 14, the Cabinet Committee on Economic Affairs approved the sale of a 60.72% combined stake held by the Centre and LIC to a Fairfax group entity.
The proposed transaction is valued at approximately ₹52,878 crore and remains subject to regulatory scrutiny by the Reserve Bank of India, including approval for Fairfax.
The government and LIC will retain their residual stakes in the bank, allowing them to benefit from potential future value appreciation, according to the Finance Ministry.
Piyush Goyal Defends India’s RCEP Exit; Supports Proposed US Trade Agreement
Commerce Minister Piyush Goyal defended India’s 2019 decision to stay out of the Regional Comprehensive Economic Partnership (RCEP), arguing that the move protected domestic manufacturing.
Speaking at the ISID-IDRA conference in New Delhi, Goyal credited Prime Minister Narendra Modi for the decision. He argued that joining RCEP would effectively have amounted to entering a free trade agreement with China, potentially exposing domestic manufacturers to greater competitive pressure.
Goyal also defended the proposed India-US trade agreement, saying it would safeguard India’s sensitive sectors. The Commerce Minister expressed confidence that Indians would welcome the agreement once its details were made public.
Key takeaway: The government is defending its approach to strategic economic policy on multiple fronts, including the IDBI Bank disinvestment process and trade negotiations. The proposed bank sale has gained an additional ₹3,917 crore through the second bidding round, while the government continues to position its trade policy as protective of domestic manufacturing.
How much is the proposed IDBI Bank disinvestment worth?
The proposed transaction is valued at approximately ₹52,878 crore.
How much did the second bidding round add?
It added approximately ₹3,917 crore to the transaction value.
What percentage of IDBI Bank is proposed to be sold?
The proposed transaction involves a combined 60.72% stake held by the Centre and LIC.
Who is the proposed buyer of IDBI Bank?
A Fairfax group entity is the proposed buyer, subject to regulatory approvals.
Why did India withdraw from RCEP?
The government argued that staying outside RCEP would protect domestic manufacturing and reduce exposure to competitive pressures, particularly from China.
