The PSU’s (Public Sector Undertakings) which are making profits should not be privatized because they are revenue generator for the Government. But if a PSU is an inefficient and loss making one, then the same PSU exerts unnecessary burden on the Government’s scare revenues and further may lead to budget deficit. The loss making PSU’s should be privatised.
Further some of the PSU’s like waterways, railways enhance the welfare of nation and is meant to serve general public at a very nominal cost. Privatisation of such important PSUs will lead to loss of welfare of poor people. Hence only less important PSUs should be privatised while leaving the core and important PSUs to be owned by the public sector.
Instead of privatisation of profit making PSU’s Government can allow more degree of autonomy and accountability in their operations, which will not only increase their productivity and efficiency but also enhance their competitiveness with their private counterparts.
