The Central Government is hell-bent on privatizing all the public sector utilities irrespective of their being profit-making or loss-incurring. This can be understood well from the recent statement of the Union Finance Minister Nirmala Sitharaman and that of Minister of State of Heavy Industry and Public Enterprises (HIPE) Arjun Ram Meghwal. While Finance Minister has told the Parliament members in no uncertain terms that the private sector would help unlock the real potential of Central Public Sector Enterprises (CPSEs) and hence privatization is necessary, Arjun Ram Meghwal has said that his government is planning to offer incentives to those state governments that withdraw shares in PSUs.
We have come a long way since the nineties in terms of privatisation, gains and sufferings notwithstanding. Began in the regime of Rajiv Gandhi, the economic reforms gained momentum in PV and Manmohan times. Pointing to the sick industries, at first, they suggested they be closed down in order to unburden the government from the overheads. They were successful in shutting them down. Then they showed us what they called potentially sick units and offered Golden Handshakes, voluntary retirements to the employees of whom a vast majority, particularly the less paid, reduced to doing menial jobs sans social and economic security. Visakhapatnam stands as a testimony to this. Many of those who forcibly opted for Golden Handshake aka VRS in Hindustan Shipyard Limited were seen working as security guards for apartment buildings and shops. Then these advocates of privatisation turned their attention towards profit-making companies and disinvested equities even in the state-owned oil majors such as HPCL and IOC.
Did not we fall prey to the privatisation theories?
Although a bit hard to agree with the fact that many of us willingly or unwittingly welcomed the new economic and industrial policies of the respective governments, excepting marginalised sections that had borne the brunt of these policies right at that moment. Ever since theories of liberalisation, privatisation and globalisation made a quick foray into the realm of politics and dominated media debates during the nineties, many of us got influenced by them and began to think privatisation was the panacea for all the ailments that the nation was suffering from.
Of course, we had every good reason to believe that privatisation was the way out for all the problems. Many of us needed reduction of red tape and corruption since our files waiting for approval did take months to move across office tables, wanted speedy trains to get to our destinations in a jiffy, desired wide express highways for bumpless travel, wished to have scooters and cars of our choice and have them delivered as soon as the payment was made. Then the nation had faced with the balance of payments issue anyways. Many of us did not dig deep into the causes of any of these issues, nor tried to control our desires, nor questioned the public representatives.
When licence raj became the new buzzword and was cited as the lone hurdle in the path of quick development, when the grey-haired economists kept saying that we should get rid of it, when the fledgeling private news media which had struggled to establish itself for a long time in the licence raj kept blaring in sweet English that we should do away with it, many of us fell prey to the theories.Yeah, we had our own reasonswhich wereseen from our subjective perspectives. Larger interests got defeated at the hands of subjective aspirations.
PSUs a step away from extinction!
Now the Central Government under the aegis of Prime Minister Modi has been taking these economic policies several steps forward unlike the previous Congress government which at least would take a step back not able to cope with the clamour the Left consistently made as long as they were its coalition partners. And the public sector is now just a step away from extinction.
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Soon after Independence, the first sovereign government preferred the public sector to the private sector keeping in mind the dire need for infrastructure in the country. No domestic investor was ready to invest hefty amounts in the basic industrial infrastructure and infrastructure sector which was unprofitable for them. Though in a phased manner, the government invested in these sectors which included power, transport, communication and the core industries.
Just liberated from the clutches of the British exploiters, the country was fraught with myriad difficulties of which the poverty and unemployment problems plagued much. The public sector industries provided employment for numerous employees across the country and improved their lives and social standards. Those who lived on the fringes owing to the ruthless caste system got employment in the public sector. As long as the politics and the administration were public-spirited, transparent, non-corrupt and under the influence of the Independence struggle, the public sector thrived and offered huge dividends to the government in return. And these dividends were put to use for social development.
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Who is usurping PSUs?
The investor collective which did not rise to the occasion when the country badly needed huge investments for developing basic infrastructure and core industries (except a few) and used that infrastructure base created by the public sector to its advantage is now trying to usurp the public sector. Majority of the political parties whether in power or opposition have been preaching and endorsing privatisation. The blame is thrown on the public sector enterprises, welfare characteristic of the state, lethargy on part of the staff, inefficient management, lack of competition, labour laws, outdated technology, productivity issues etc. But what is lacking is the political will of the governments.
Had the ruling parties demonstrated that will, the Hindustan Zinc Limited and Balco would not have gone into the folds of Vedanta and the sale of the Visakhapatnam Steel Plant (VSP) would not have been on the cards now. Although the will is missing, major political parties in Andhra Pradesh have been vying with each other in protecting the Visakhapatnam Steel Plant from being privatised. Unity of workers apart, what seems to be sure protection for the VSP is this competition for protection of the plant between the two main parties TDP and YSRCP, though both of them do not have any principle differences with the economic policies of the BJP. One need not probe much as to why these parties are vying with each other for protecting the plant from being privatised. There is public sentiment running high around the plant which came into being after a prolonged agitation and human sacrifices.
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