Over the next four years, the Indian government plans to raise over ₹80,000 crore by progressively lowering its holdings of a number of railway Public Sector Undertakings (PSUs). This action is a component of the government’s larger plan to sell off public assets and raise money for development and infrastructure initiatives.
The government will choose the precise order and magnitude of each sale based on market conditions, with the sales anticipated to start in FY27 and last through FY30.
The proposal was considered during a recent session of the Core Group of Secretaries on Asset Monetisation, which is chaired by Cabinet Secretary TV Somanathan. It is a component of the Modi government’s asset monetisation plan under the National Monetisation Pipeline (NMP). According to officials, the government may sell stakes in these enterprises in many rounds using the offer for sale (OFS) method.
A senior government official revealed, “The stake in some of these PSUs will need to be reduced to the 51 per cent threshold to unlock capital for the government,” reported Business Standard. The seven PSUs are:
- Indian Railway Finance Corporation (86.36% government control)
- Rail Vikas Nigam (72.84% government control)
- RITES (72.2% government control)
- IRCON International (65.17% government control)
- RailTel Corporation of India (65.17% government control)
- Indian Railway Catering and Tourism Corporation (62.4% government control)
- Container Corporation of India (54.8% government control)
At the moment, the government owns the majority of each of the seven businesses. With a ₹2.78 trillion allocation for 2026–2027, the railway ministry has the second-highest capital expenditure budget among federal ministries and is still investing in asset construction. The ₹2.5 trillion asset monetisation target set by the National Monetisation Pipeline could be supported by the share sales.
These PSUs have a total market value of almost ₹3.5 trillion, according to market estimates. According to analysts, the government could be able to raise about 70,000 crore if it were to sell off about 20% of these companies. Despite modest progress, the centre has previously stated its intention to privatise Container Corporation of India by selling off a 30.8% stake.
The concept of a “government company” under the Companies Act should be changed, according to the 2025–2026 Economic Survey. More equity monetisation would be possible while maintaining control if the proposal permits listed PSUs to maintain government company status with at least 26% government ownership.
The ₹80,000 crore aim, according to officials, is ambitious but doable given the favourable market circumstances and investor demand for assets related to infrastructure. The revenues will be utilised to fund new development projects, debt reduction, and future infrastructure investments in line with India’s growth and fiscal consolidation objectives.
According to experts, if these transactions are executed well, they may open the door for akin disinvestments in other industries, like energ and logistics, as part of the government’s asset monetisation and strategic divestment policy.
