Monday, July 03, 2017

Disinvestment of Air India: Private sector wanted it, not the government

Disinvestment of public sector companies is still an unfinished agenda of the central government, no matter which party rules the Centre.

The last 26 years of liberalisation and privatisation have proved that disinvestment is not a simple job. The common man in the country never expected during the early period of 1991-92 that one day he would lose access to public goods. He never expected that Modern bread company would become a private firm and that he would have to pay for essential public goods.

Though PM PV Narasimha Rao and then finance minister Manmohan Singh initiated the project of larger transformation of the economy, they did not have a full operational plan. It started gradually, and moved on to building consensus with political parties and not necessarily with the public.

Disinvestment was initiated in 1996 by the United Front government. The first proposal came out as a committee constituted by the ministry of industry to look into the possibilities of disinvesting public sector companies.

Many of these companies were enjoying market monopoly at that time and were playing a vital role in infrastructure development of the nation.

It is mentioned that “the commission while advising the government on the above matters will also take into consideration the interests of stakeholders, workers, consumers and others having a stake in the relevant public sector undertakings” - (quote from the disinvestment commission’s Report IV in 1997).

A close assessment of disinvestment since 1991 proves that governments at the Centre hardly cared for the interests of workers, consumers and others having a stake in the public sector units. A consumer of Modern Food Industries, a company which offered better quality bread at an affordable price, never wanted it to be privatised.

Getting larger public support for disinvestment is still a challenge.
03/07/17 S Mohammed Irshad/Daily O