For several years now, Life Insurance Corporation of India (LIC) has been helping the government meet its divestment targets. A report by Kotak Institutional Equities pointed out that LIC has contributed 33% of the divestment receipts between FY12 and FY16, reports fe Bureau in Mumbai. LIC has also been actively supporting the government with its plan of recapitalising state-owned banks. On Thursday LIC subscribed to shares of Oriental Bank taking its stake to 15%.
The report also said, “The transfer of shareholding from the government to LIC hardly serves any purpose apart from providing the government some cash for its daily needs and to meet its fiscal deficit targets. There is hardly any meaningful change in the government structure of the entities where LIC partly replaces the government as the shareholder.” The government’s disinvestment target in FY16 was `69,500 crore but it collected around `19,514 crore.