News APP

NewsApp (Free)

Read news as it happens
Download NewsApp

Available on  gplay

This article was first published 16 years ago
Rediff.com  » Business » Govt decision on FDI in oil PSUs delayed

Govt decision on FDI in oil PSUs delayed

Source: PTI
May 24, 2007 15:41 IST
Get Rediff News in your Inbox:
India-born billionaire Lakshmi N Mittal's Rs 3,365 crore (Rs 33.65 billion) investment for taking 49 per cent stake in Hindustan Petroleum Corp Ltd's Bhatinda refinery in Punjab will have to wait a little longer for government approval as the Cabinet did not take up the issue on May 24.

The Cabinet Committee on Economic Affairs was to take up the issue of raising foreign direct investment cap in public sector refineries to 49 per cent from the current 26 per cent to facilitate Mittal to pick up stake in the Rs 17,973 crore (Rs 179.73 billion) project.

"The issue was not taken up," a government official said. HPCL had on March 2 signed an agreement with Mittal Investments Sarl, the holding company of L N Mittal, for the 9 million tons refinery in Punjab. Mittal Investments Sarl is picking 49 per cent stake in the refinery project through its 100 per cent subsidiary, Mittal Energy Investments Pte Ltd that has been incorporated in Singapore.

HPCL will also hold 49 per cent stake in the project while the balance two per cent would be allocated to financial institutions. Sources said though, as per the current policy, in case of private Indian companies 100 per cent FDI is permitted under the automatic route, in case of public sector units, FDI in petroleum refineries is permitted only up to 26 per cent.

The current policy also restricts PSU holding to 26 per cent in such projects and makes it mandatory for the balance 48 per cent to be offered to public. The issue is likely to be taken up at the next CCEA meeting, the sources said.

Get Rediff News in your Inbox:
Source: PTI© Copyright 2024 PTI. All rights reserved. Republication or redistribution of PTI content, including by framing or similar means, is expressly prohibited without the prior written consent.
 

Moneywiz Live!