Business Env- Public Sector Reforms
Transcript of Business Env- Public Sector Reforms
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GOODGOOD MORNINGMORNING
ALL OF YOUALL OF YOU
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PUBLIC SECTOR
REFORMS
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DISINVESTMENT
PROGRAMME
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CONTENTSCONTENTS
PUBLIC SECTOR REFORMS
INTRODUCTION TO PUBLIC SECTORREFORMS..WHAT IS PUBLIC SECTOR..???PROBLEMS FACING PUBLIC SECTOR/
REASONS FOR PRIVATISING PSUSPUBLIC SECTOR REFORMSOBJECTIVES OF PUBLIC SECTOR
REFORMS
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DISINVESTMENT PROGRAMME
DISINVESTMENT TRENDS SINCE 1991
PRESENT DISINVESTMENT POLICY OR
WAYS OF DISINVESTMESNT
MAJOR ISSUES CONCERNING
DISINVESTMENT PROGRAMME
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PUBLIC SECTORPUBLIC SECTOR
REFORMSREFORMS
The basic design of reforms can be seenin industrial policy 1991. The Basicthrust of public sector reforms has been
to attain sharp focus, improveefficiency & profitability & grant greaterautonomy to public sector units so as toenable these institutes to work oncommercial & professional lines..
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WHAT IS PUBLICWHAT IS PUBLIC
SECTOR???SECTOR???STATE BANK OF INDIAORIENTAL BANK OF COMMERCEINDIAN OILONGCPUNJAB NATIONAL BANKHINDUSTAN PETROLEUM
CORPORATIONBHARAT PETROLEUM CORPORATIONBHARAT HEAVY ELECTRICALS(BHEL)
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In simple words, PUBLIC SECTORUNITS refer to the industrial institutionswhich are managed & controlled by
state or central govt.
Prior to 1947 there was no public
sector in Indian economy. Therewere only few state managedundertakings like
Government salt factories, quinine
factories..etc.
After independence, India adoptedmixed economyas its economicsystem.
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Public sector includesfollowing:
Government departments &Government companies both inCentral & State sectors..,
Irrigation & power projects..;
Railways, Post & telegraphs, ordnance
factories & other departmental units;
Banking, insurance, financial & otherservices
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Within this public sector , the focus ismainly on central PSUs which have thefollowing three broad organizationalforms:
DEPARTMENTAL UNDERTAKINGS
JOINT STOCK COMPANIES (reg. undercompanies act)
STATUTORY CORPORATION
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PROBLEMS FACINGPROBLEMS FACING
PUBLIC SECTORPUBLIC SECTOR
BUREAUCRATISATION , RED TAPISM ORPOLITICAL INTERFERENCES
PROBLEM OF LOSSES OR LOW RATE OFRETURN ON INVESTMENT
LACK OF PROFESSIONALISM INMANAGEMENT
UNDER UTILISATION OF CAPACITY
OPERATIONAL INEFFICIENCY
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PUBLIC SECTORPUBLIC SECTOR
REFORMSREFORMS
The growing pressure of criticism againstpublic sector within the governmentcircle & private industry has led toseries of reforms including
disinvestment..OBJECTIVES :RESTRUCTURING OF PSUS
IMPROVEMENT IN PERFORMANCE OFPSU SOCIAL WELFARE PROFIT MOTIVEQUALITY HUMAN RESOURCE
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DISINVESTMENTDISINVESTMENT
PROGRAMMEPROGRAMME
Disinvestmentis generally expected toachieve a greater inflow of privatecapital and the use of privatemanagement practices in PSUs, as wellas enable more effective monitoring ofmanagement discipline by the private
shareholders. Such changes would leadto an increase in the operationalefficiency and the market value ofPSUs.
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DISINVESTMENT TRENDSDISINVESTMENT TRENDS
SINCE 1991SINCE 1991 Disinvestment programme towards
greater privatisation of economy waslaunched in 1991-92 with announcementof industrial policy 1991 & is on-going
process even today. Under the programme, the govt has been
setting targets from year to year & hasbeen resorting to diff methods &
strategies to attract private investors. Between Aug 1991 & Mar 2003, in all 48
companies underwent disinvestmentprocess.
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PARTIAL/FULLPARTIAL/FULL
DISINVESTMENT HAS BEENDISINVESTMENT HAS BEEN
MADEMADE Shipping credit &
investment
corporation ofIndia
VSNL
ONGC
GAIL SAIL
Indianpetrochemicals
corporation Ltd.
Maruti udyog Ltd.
Power grid
corporation NFL
Indian Airlines
NALCO MTNL
Madras refineriesLtd.
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CONCERNINGCONCERNING
DISINVESTMENTDISINVESTMENT
PROGRAMMEPROGRAMMEVALUATION OF PSUS
METHOD OF DISINVESTMENT
EXTENT OF DISINVESTMENT
UTILISATION OF DISINVESTMENTSPROCEEDS
ISSUES CONCERNING LABOUR
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CONCLUSIONCONCLUSION
The Disinvestment of PSUs is not favored inIndia. The reasons being: The disinvestment programme is criticised
on ground that what the govt has
collected over the years as states assetshas been now put up for sale. No one is buying sick PSUs, all efforts are
going to be directed towards selling
Healthy ones. Disinvestment is hardly making any
impact on physical & financialperformance of PSUs..
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