Fresh push for Indian privatisation

Prime Minister Vajpayee wants to speed privatisation

The Indian government has set a timetable for its next round of privatisations.

It now plans to invite bids for a 26% stake in Hindustan Zinc as well as control of 13 state-run hotels within the next month.

This is the latest push in a long and faltering process as the government wants to sell off 13 firms by the end of the year, raising $2.5bn (£1.75bn).

It has also approved guidelines for selling part of the petrol retailer IBP.

However, investors remain sceptical that the government can reach this target, given its slow pace thus far.

Fingers in pies

"Their preferred method of privatisation appears to be whatever makes it least likely to happen," John Band, executive director at brokerage ASK Raymond James told the BBC's World Business Report.

"There is absolutely no reason why they can't do one big-ticket privatisation a month... there are too many vested interests... of people who enjoy having a finger in each of these different pies," he said.

The government has managed to sell controlling stakes in computer software company CMCC and telecoms gear maker HTL.

Ambition

The Delhi government had hoped to rid itself of loss-making state-owned industries, in an attempt to make the country's industrial base more efficient and capable of competing globally.

With 27 state-run firms listed for privatisation in the past year, the government's plans were ambitious.

Political opposition to privatisation, bureaucracy and the global slowdown - which makes companies less willing to part with their cash - are all thought to have conspired against the privatisation process.

Many potential foreign investors may view the Indian market with suspicion, given an ongoing dispute between an Enron subsidiary and one of India's states over a $2.9bn power project that could be India's largest foreign investment to date.