Reigning In Fiscal Deficit: Central Government Plans To Raise Rs 20,000 Crore Through  Consolidation Of Power PSUsA power transmission line in India. (Photo by Sunil Ghosh/Hindustan Times via Getty Images)

According to reports, the Central Government is looking to sell its stakes in two power companies namely the SJVN Ltd and Power Finance Corp (PFC) as the government looks to keep the fiscal deficit in check. The proposed stake sale by the Central Government to other government owned entities is expected to result in the former netting $2.8 billion or over a little Rs 20,000 crore.

Sources are said to have confirmed that the Central Government would divest its 63.8 per cent stake in hydro-power company SJVN Ltd to NTPC Ltd while a 65.6 per cent stake in PFC is to be sold to REC Ltd.

Not only does the government want to keep a check on its fiscal deficit but the proposal to sell stake in the above companies also reflects the government’s intention in respect of achieving consolidation in the energy sphere.

However, not everyone is happy with the proposed measures of the Central Government as they feel that purchase of government stake by a state-owned entity would only result in an optical reduction in fiscal deficit.

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