New Delhi: The government is considering selling a 25% stake in Government Life Insurance Corporation of India Life Insurance Corporation (LIC). Cabinet approval will be required for this. The government is considering replacing the deficit in the budget with the sale of shares of LIC, as revenue revenue has been severely affected by the Karona epidemic. The government wants to change the law on LICs. It is learned that the shares of LIC will be sold at a time when the stock market is in a good position. So many shares will not be sold at the same time. 25% of the shares will be sold in phases.
The government wants to cope with the fiscal deficit by raising money from the sale of LIC shares. The government aims to keep the fiscal deficit within 3.5 percent of gross domestic product (GDP) for the fiscal year 2020-21. But the economic downturn in the Karona epidemic will have a serious impact, making it difficult to achieve this goal. The situation has worsened since the first quarter of the current fiscal, with a 23.6 percent growth rate. Financial deficits occur when government spending is higher than spending. The lower the country’s fiscal deficit, the stronger its deficit. The two companies will help assess the capital structure of the LII and provide information on how the company’s financial statements will be prepared. A ministerial group will determine how much of the company’s shares will be sold. The decision to change the company’s capital structure will be taken by the Cabinet. Finance Minister Nirmala Sitharaman announced in the budget this year that the shares of LIC would be sold. But he did not elaborate.
