Is disinvestment really that good for India or is a rethink in order?

Disinvestment is good up to a certain level because it generate huge funds & this fund could be deploy in social sector, subsidies & can reduce fiscal deficit as a revenue source & create good corporate governance but up to a certain level 49% as I think because above that level it direct economy towards private monopoly from state monopoly which is harmful for a country.

Disinvestment is extremely important for the economy. Some of the advantages are.

1. Helps in generation of funds for the government.

2. Helps in turning around loss making units and thereby create greater value for the shareholders and customers.

3. Provides greater time and resources for the government for core activities which is governance of the people.

However, certain control must be exercised before going for disinvestment as government Is losing its control.

1. Strategic resources like oil should be controller by govt. As they are critical for economy and people of the country.

2. Also employees should be taken into consideration before disinvestment to allay all their fears.

Disinvestment of public sectors is good option only if it is running in loss. Disinvestment will help a psu in gaining the technological knowledge from the private sectors and learning their strategies in earning profits. Otherwise the percentage share of the government should always be more than 50% as it is the government which is inclined towards the betterment of the people, society and development of backward area and removes economic differences.

In todays era of globalisation and competition, if public sectors have to survive they have to evolve. And to evolve and be competitive enough with the private sectors and global players we need to be at par with them on many aspects viz marketing technology, cost effeciency, strategic colaborations etc. In absence of this the public sectors are bound to become obsolete, loss making and then sick.

Disinvestment allows private player havin the knowledge of the sector comes in the board and help the company take actions which will make it feasable project which was other wise loss making.

And might suggest for technological innovation.

And might infuse new good managers who can motivate the work force to work effectively and efficiently. And therby contributing toward the growth of the company.

Disinvestment is necessary to get rid of financial burdens of government in PSU's which are under-performers but it should not go to a level where everything is privatized because there are more poor people in India.

Hello friends.

In this age of globalization it is very necessary that the companies must update with the latest technologies of the time because they have to face the top class products of the entire world, and we all very well know the amount of technological knowledge that he the Indian public sector posses.

Therefor I highly feel that a certain amount of controlled disinvestment policy is very important (which is in fact being followed by the in Indian government) as the private companies will bring the latest technologies and management practices with them which would help in the development of the enterprise.

Moreover, this measure will help the government to lessen it burden of managing the enterprise and focus on much important objectives.

One of the best eg. of such practice is the U.S. Where high level of public private partnership occurs.

Yes, it is very useful to collect the money in this manner which will show impact on the welfare of the of people.

Divestment is really going to infuse funds in the government safe but it may at the same time have to let go the robust dividends it is receiving by the investments in the PSUs. Government divestment target for 2015-16 was (which is now reduced to Rs. 30k Cr) to collect Rs. 70,000 Cr.

But GOI fetched Rs. 36,000 Cr from dividends through PSU investments in 2014-15 and that too with such an inefficient PSUs. Therefore, policymakers should focus on improving the operational efficiency and not just on getting rid of those investments.

No doubt disinvestment will bring good managers and help the company to improve the sale but the government should keep some points in mind.

No matter how much loss a company has beard, government should have some stakes so that they can figure out the positive changes. Next the private company should not indulge in monopoly. Government should share the insights of the deal to gain the confidence of the employees. We should keep in mind the consequences of what happened in BALCO.

Disinvestment policy is very harmfull to poor Indian as well as growth of inferastructure. This policy will establish monopoly of rich person. This is beganing of capitalist economy. Since it should be stop for general man.