That the state-owned Air India has earned operating profit of Rs 100 crore in the financial year 2015-16 may be a news given its long history of heavy losses but not a headline grabbing one given the smallness of profit and the incomplete picture operating profits give. And certainly not the kind of news that warrants announcement by the Prime Minister in his address to the nation on the August occasion of its Independence Day. He also, for good measure, did not forget to mention in the same speech with the same touch of pride the supposed BSNL turnaround story.
The problem is not so much with Modi shouting from rooftops the incipient and transient success of two public sector enterprises (PSE) but the more disturbing signal it sends-- -- the government is not very keen on stepping up the gas on its disinvestment agenda but somehow keen on rationalising its blind faith in PSE. In fact the NDA II has been going slow on disinvestment unlike NDA I under the leadership of Atal Behari Vajpayee which privatised the aluminium PSE firm Balco, Hindustan Zinc, Hindustan Copper, VSNL and Computer Maintenance Corporation. Modi made no secret of his fondness for PSEs when on campaign trail for the 2014 Lok Sabha elections, he often cited the GSFC successful turnaround story in Gujarat under his leadership as chief minister to implicitly build a case for PSEs.
To be sure, a strong case existed for the public sector especially in areas where capital was shy. Setting up of Steel Authority of India (Sail), Bhel etc therefore wasn’t wrong. Even Air India and Indian Airlines had reason to take wings because in those days the skies weren’t open for the private sector. But none of them have a rationale to go on and on despite the mounting losses. Government resources tied up in PSEs can be more productively used in subsidising the basic requirements like food, gas, electricity and other bills of the poor.
17/8/16 S Murlidharan/First Post
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The problem is not so much with Modi shouting from rooftops the incipient and transient success of two public sector enterprises (PSE) but the more disturbing signal it sends-- -- the government is not very keen on stepping up the gas on its disinvestment agenda but somehow keen on rationalising its blind faith in PSE. In fact the NDA II has been going slow on disinvestment unlike NDA I under the leadership of Atal Behari Vajpayee which privatised the aluminium PSE firm Balco, Hindustan Zinc, Hindustan Copper, VSNL and Computer Maintenance Corporation. Modi made no secret of his fondness for PSEs when on campaign trail for the 2014 Lok Sabha elections, he often cited the GSFC successful turnaround story in Gujarat under his leadership as chief minister to implicitly build a case for PSEs.
To be sure, a strong case existed for the public sector especially in areas where capital was shy. Setting up of Steel Authority of India (Sail), Bhel etc therefore wasn’t wrong. Even Air India and Indian Airlines had reason to take wings because in those days the skies weren’t open for the private sector. But none of them have a rationale to go on and on despite the mounting losses. Government resources tied up in PSEs can be more productively used in subsidising the basic requirements like food, gas, electricity and other bills of the poor.
17/8/16 S Murlidharan/First Post
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