Privatization in India is comparative study between 1991 and present situation
The transfer of ownership, property or business from the government to the private sector is termed privatization. After privatization, the government ceases to be the owner of the Entity or Business. India went for privatization in the historic reforms budget of 1991, also known as ‘New Economic Policy’ or LPG policy. Dr. Manmohan Singh is considered as the Father of NEP of India.
The main reason for privatization was currency of PSU’s, are running is losses due to political interference. The managers cannot work independently. Production capacity remained underutilized. The increase in competition and efficiency privatization of PSU’s was inevitable and that time share of private sector has increased from 45% to 55% and government has sold enterprises worth Rs. 30,000crores to the private sector.
Criticisms in 1991:
- Ignores weaker section.
- Neglect backward areas and not offer job reservation to SC, ST and OBC candidates.
- Motive is only to earn profit and neglect public welfare.
- New technology causes unemployment.
Now its 2022 and today’s criticism are:
- Job insecurity.
- Private sector exploiting its employees.
- Government is thinking about to sell most of the public sectors.
- Railway lines going to be privatized.
- Defense ministry.
- Education and banking sector.
- We can see the impact of unprecedented lockdown, due to outbreak of corona virus, so many private employees didn’t get their salaries and some expelled from jobs. An estimate 12.2crore lost their jobs during the corona virus lockdown in April. So, it is clear that private employees has no job security, they are just puppet of private companies.
Government is now thinking about to privatize the railways. There are 23 million passengers travel everyday in railways. And before lockdown the IRCTC earns nearly Rs. 1,50,000 crores everyday by ferrying passengers, which translates its revenue earnings of Rs. 53,000crore annually. And if it privatized then there are many people who are unable to afford it because if it privatized they definitely rise the price of the ticket.
There are so many people who are poor and illiterate too. Firstly, Government should make people aware about the privatization and make them able to deal with their private players.