Home INDIA Privatization of PSUs: Is it Atmanirbhar Bharat?

Privatization of PSUs: Is it Atmanirbhar Bharat?


With the recent plan of privatization of many PSUs ( Public Sector Undertakings ), this is the government’s move to uplift the economy. The plan to privatize the PSU’s was proposed by Finance Minister Nirmala Sitaraman.

The government believes this to be the best possible way out of such a debt. As we all know the economy is negative and a quick revival is necessary but is this the cost we need to pay. Find out further in the article.

What are PSU’S?

What are PSUs and why its privatazion is not done.

The government of India keeps certain agencies and industries under its control. These sectors are known as Public Sector Undertakings.

The work of these sectors is also undertaken by government. These units are formed with the sole motive to generate employment in the country.


Earning profits is not their motive. Several exams are also conducted for the recruitment to these departments.

Service to the layman of the country and providing the best in transportation and finances is not only necessary but is also the duty of the government.

Privatization in the Foreign Nations

Is privatization good or bad for a country simply depends on the economic condition of the country . The status of  a country , i.e. whether it is a developing or a developed nation also hold significance.

Privatisation in developed nation.

If we talk about the developed countries like that of the west then major improvement is seen in the quality of services provided.


Private sector firms that take over the public sectors always aim at providing the best of services and constantly upgrade to the better technology.

With the increase in facilities and better services, it is obvious that the cost of availing the services will also go up.

If a nation is already a developed one then no significant change is seen in the level of its citizen’s spending when the public sector is privatized.

The amount spent on transportation and other things is more or less the same. It happens because the per capita GPD and income of the people are high.


So a slight change would not affect them. People over there also wish for better services as the quality of life is also very high.

The cost of Privatization in India

Cost of privatisation.

Privatization in India will not have the same repercussions as in the west. Our condition is totally the opposite. The per capital GDP, Income level and the quality of life are all quite low.

As discussed above private firms enter an industry to grow and yield profits out of it. Public services and keeping the cost low is none of their concern. The life of the people here will definitely be affected by the rise in the prices.

Transportation is the lifeline of a country and an increase in the prices of such an essential mode will severely affect the people.


People always want to travel at the lowest possible prices but with the private firms entering the Indian Railways. Keeping the cost low won’t be possible.

If the cost of transportation is high it in turn affects the business as well. The cost of goods supplied also increases, leading to a decrease in demand.

Employment facilities in these sectors also might do down .

Is Privatization of PSUs good?

There is no definite answer to the question. As it totally depends on the industry or PSU that will be privatized.



Privatization of Indian Railways, one of the major Indian PSUs.

If it is the railways then, speculations are that the decision would have negative effects. With the fall in employment and increase in prices this industry would suffer. More than the industry , the people of the country would suffer.

The induction of the latest train Tejas Express is one such example. Due to the high fare prices, it is not a mode of transportation for the poor. Trains connect each and every smallest part of the country.

However, after the privatization of this PSU, trains may or may not run on every track and in every nook and corner of the country as the people to travel on those routes are very limited.

The cost of running might be greater and no private sector firm would like to incur losses. Which would ultimately cause the shutting down of trains on that route.



Privatisation of Air India, another Major Indian PSUs.

Privatization of the airports is another example but indeed a good one. Air travel is something that a very less number of people opt for as it is a relatively costlier mode of traveling.

So the people with a higher income opt for it. An increase in prices would not affect them that much.

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Privatization VS Atmanirbhar Bharat

Privatisation of PSU vs Aatmanirbhar  Bharat

The government is also planning to privatize many banks and sell a few shares of LIC ( Life Insurance Corporation Of India ).

These units are also considered to be the backbone of the country. The annual revenue generated from the LIC is very high and is a very good PSU. With the motto given such as “ Atmanirbhar Bharat”, this is what is going on with the PSU’s.


If the privatization of the PSUs and other industries continues with this pace then the motto would exist only in name.

What Atmanirbhar Bharat need is to promote more and more PSU’s and not to privatize the existing ones. The government’s aim should be to promote them and give them incentives.

This would persuade them to work more and generate more revenue for the country. The PSUs are also one of the main sources of revenue for the government which can be used in further expansion.


Privatization of any PSUs or any industry highly depends on how it is implemented. Because if Privatization of PSUs helps to create a monopoly in any sector then every citizen will suffer in long.


Certain rules and regulations are needed to check that private companies don’t cripple pockets of the public to earn money.

Some may argue that privatization of PSUs will lead to innovation and proper development in that sector. Also privatisation makes the sector more efficient and effective.

Till the time the government really privatizes the PSU’s nothing can be said in a definite wayThe speculations until now are not satisfying.

Economists are generally not in favor of the decision but the control is totally in the hands of the government. All we can hope for is the best results.




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