The government is considering a tweak in the current foreign direct investment (FDI) policy to allow overseas investors pick up majority stake in Bharat Petroleum Corporation Limited (NSEI:BPCL), sources said. The government is privatising BPCL and is selling its entire 52.98% stake in the company. For BPCL privatisation, Vedanta Limited (NSEI:VEDL) had put in an expression of interest (EoI) for buying the government's 52.98% stake in the PSU.

The other two bidders are said to be global funds, one of them being Apollo Global Management, Inc. (NYSE:APO). The proposal is under discussion between the departments of disinvestment (DIPAM), industry (DPIIT) and economic affairs (DEA), they said. At present, only 49% FDI is permitted through automatic route in petroleum refining by the public sector undertakings (PSU), without any disinvestment or dilution of domestic equity in the existing PSUs.

With this provision, a foreign player would not be able to buy more than 49% stake in BPCL. On the other hand, the Department for Promotion of Industry and Internal Trade (DPIIT) has proposed for a separate provision for this specific situation. The proposed amendment to the FDI policy is under consideration for enabling investment in BPCL as part of the disinvestment process, they added.