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Why Indian government is privatising public sectors? Is It Good or Bad


In recent years Central Government is keen on privatising public sectors. 

Here are some key factors about government stretagey behind privatising public sectors.

The government has “no business” to be in business .

Strategy of Central Government for privasiting Public sectors.

Prime minister Narendra Modi made it very clear push for disinvestment and privatisation of public sector undertakings (PSU).

The prime minister further said that it’s the government duty to provide support to enterprises and businesses but it is not mandatory that government should run them.

Mr prime minister added that we cannot continue with public entities just because they are operational for long .

There is a strong need for change in the system.

What are the reasons for privatisation ?

The main reason to bring privatisation is that it brings modern technology,  a change in management mindset and creates more efficient job opportunities.

Other reasons for privatisation includes a large benefit to the public as the money comes from monetization will be utilised to enhance basic facilities like rural development, safe drinking water and cheap housing.

Hence, It will not only produce require fund but also boost investing drive.

Which companies are going to privatise?

After it sells the government stake in profit making public sector undertakings such as Bharat Petroleum Corporation Limited(BPCL), Shipping Corporation of India(SCI) and Container Corporation of India (CONCOR) as already announced ,the Modi government is planning to sell its stake in another 46 public sector companies.

Is privatisation good for India?

Privatisation is beneficial for the growth and sustainability of the state owned enterprises.

To achieve an increase in the output of the country ,there is a need of privatisation at a rapid scale which will help in improving quality of products, hence curbing public spending and raising cash to reduce public debt.

What are the adverse impacts of privatisation?

No welfare state.

The concept of welfare is going to extinction due to privatisation .

Private sector would not care about society as their aim is to make profits.

Less social development.

Public sector enterprises keep working for the society.

Incase of privatisation,there will be fewer funds for society development.

Long term risk.

Private companies may provide short term benefits but an employee is always unhappy  about his future .

Written By – Deepak Kumar ( Senior Analyst)

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