Discuss the Disinvestment policies undertaken in public sector with examples.
Answers
Disinvestment in Public sector units in India, is process of public asset sales by President of India on behalf of Government of India, directly (offer for sale to public) or indirectly (bidding process) in capitalized market. The Public Enterprises Survey (2015-16), brought out by the Department of Public Enterprises, Ministry of Heavy Industries & Public Enterprises, Government of India on the performance of Central Public Sector Enterprises was placed in both the Houses of Parliament on 21st March, 2017. There were 331 CPSEs in 2017-18, out of which 257 were in operation. Rest (74) of the CPSEs were under construction.[1]
As in need of Economic Liberalism and Infrastructure development, in Union Budget of India Total Expenditure of Government of India increased from ₹ 1,13,422 crore (1991-92) [2] to ₹ 21,46,735 Crore(2017-18)[3]. To raise the funds partially for these Expenditures and also to minimize fiscal deficits in union budgets, Indian Government started divestment in public sector undertakings. Conceding to demands of privatization and with tough resistance from labour unions, government of India is slowly divesting from PSUs. The below table provides the data for divestment which started from 1991(Barring 2 small units CMC Limited and Patherele Concrete).