Govt may consider ordinance for Hindustan Zinc stake sale

Sources indicate that the government may mull ordinance for Hindustan Zinc stake sale reports CNBC-TV18's Aakanksha Sethi.

Hindustan Zinc was set-up by an Act of Parliament. Hence, to divest stake in it, you need Parliament approval as per the Metal Corporation Act 1976. The law ministry has given advice to the finance ministry and the mines ministry saying that it would be illegal for the stake to be divested without Parliament approval. Hence, the finance ministry is considering an ordinance to amend that and to cure that. They say that an ordinance of this sort should not meet with any opposition because it was the National Democratic Party (NDA) government that had divested the first time around. So, they say that the opposition will be on board and the ordinance will garner support and will easily be approved in Parliament later. Also read: Expect 12.5% divestment in RCF by Q4 FY13 via OFS, says CMD This will have to be approved by Cabinet. It will be one of the last resorts. This year, there is a Rs 30,000 crore divestment target. It may be met with NMDC, Oil India, NTPC and NALCO issues. But the government also has to compensate oil marketing companies (OMCs) and they may face a loss on account of spectrum. So, they are going to look at the final numbers and see how they are going to proceed with this. Even, for the next year, if they have to meet 4.8 percent, they will have to rely on capital receipts as a large amount of revenue mobilisation. Hence, HZL and BALCO divestment will take center stage. Meanwhile, sources say, Vedanta has sent fresh missive to the Government of India (GoI) on HZL stake sale on December 24, 2012. It feels dismissal of petition by SC validates case. Vedanta is keen on immediate closure of balance share sale.