The Republic of India would be selling off part of its shareholdings in Coal India Ltd. The goal of selling off the world's largest coal producer at a projected 200 billion rupees or US$3.7 billion would be to narrow the largest budget deficit the country has faced.

The government owns 90% of the coal miner and would only be selling off 5% in a public offering according to a draft proposal from the Ministry of Finance obtained by Bloomberg News.

The administration of Prime Minister Manmohan Singh has sold other government shareholdings in other companies, such as NTPC Ltd, Oil India Ltd and NMDC Ltd, and has raised 240 billion rupees as of March 31. The proceeds would be used to narrow the deficit, pay for subsidies and invest in infrastructure projects. 

Share values of Coal India Ltd rose by 3% to 310.75 per share in the Mumbai bourse, the highest since April 19. The shares have declined 12% overall in 2013.