The government is counting on a state-owned company buying its stake in another public sector firm to help it exceed the disinvestment target of Rs 800 billion for the year. This would be Rural Electrification Corp buying all or a substantial portion of the government’s stake in Power Finance Corp.

However, sources in the two companies and the Ministry of Power say doing such a deal does not make sense for either of the firms, and, even if it were tried, it may not be completed before the end of the financial year. There are doubts if the Department of Investment and ...