Government Stake in Kribhco Not Reduced

With Krishak Bharati Cooperative Ltd (Kribhco) recently announcing to the Department of Fertilisers that Indian government would not reduce its stake in the company to 26%, the conflict between Kribhco & the government came to an ended.  The Centre's share in Kribhco's equity had in the past fallen from 67.73 per cent to 48.35 per cent. The reduction in the stake was the result of the co-operative redeeming the shares held by the Centre in it as per the provisions of the Multi State Cooperative Societies (MSCS) Act, 2002 (MSCS). The Centre was not interested to divest its stake in co-operatives as under Section 35 (2) of the MSCS Act, the redemption of shares in co-operatives can only be done at face value and so the Centre could not make money of the kind it would by offloading equity at a premium in PSUs.