Agence France Presse

New Delhi, January 12:

India plans to sell shares in state-owned companies including the country’s largest carmaker Maruti Udyog and power-equipment firm Bharat Heavy Electricals (BHEL) in order to cap the budget deficit, an official said today. “We are pushing for disinvestment of Maruti and BHEL this year. We want to do it this fiscal year,” a finance ministry official, who did not wish to be named, said. India’s fiscal year ends on March 31.

Maruti shares rose by Rs 6.35 Indian Currency (IC) or 1.5 per cent to Rs 430.10 IC , while BHEL was up by Rs 1.65 IC or 0.22 per cent to Rs 742 Ic after the official’s comments.

In July, the government said it would cut the country’s fiscal deficit to 4.4 per cent of gross domestic product (GDP) from 4.6 per cent in 2003 by raising revenues from the services sector and getting more people to pay income taxes. Only about 30 million of India’s estimated 240 million strong labour force pay income tax.

India’s government has already sold the majority of its holdings in Maruti and currently owns an 18 per cent stake. Japan’s Suzuki Motors holds a 54 per cent stake while the remaining shares are owned by other investors. BHEL is completely owned by the government. “The finance minister has already met the PM on privatisation issue. Even a five per cent stake sale in BHEL could fetch a substantial amount,” the official, said