PRESENTED BY: Anurag John Kujur; 10202163 Bimla Acharya; 10202165 Roshni Mukherjee; 10202167 Abhishek Dash; 10202169

Arindam Mukherjee; 10202171 Suresh Kumar Sah; 10202173

Privatization may be defined as the transfer of a function, activity or organization from the public to the private sector.

Privatization indicates the emergence of a new culture in the society in which marketization, competition, efficiency become the guiding principle in economic decisionmaking.

 The

range of activities covered under privatization are: total denationalization liquidation creation of joint ventures workers cooperatives contracting our to private agencies leasing and financial restructuring.

1. 2. 3. 4.

Share issue privatization Asset sale privatization Voucher privatization Privatization from below

Improving the government financial position by

Raising funds from the sales of enterprise or their;

Making the enterprises raise internal resources and from capital markets, thereby reducing budgetary support to them

Improving the performance of an enterprise through

Increased efficiency; Requiring enterprises to meet commercial performance objectives; Greater responsiveness to consumers (whether in terms of quantity, quality, diversity or services); Relief from public sector financial constraints; More managerial

Besides the above two broad objectives; privatization would help in reducing the burden on public administration by reducing the size of the public sector, strengthening market forces and competition within an economy and promoting wider share ownership among public.

Privatization will introduce efficiency and profitability in PSUs. It will reduce budgetary deficits which result from expenditure on loss making PSUs. It will help in reviving sick units which are a burden on Public Sector.

 It

will help in bringing about globalization by opening out of an economy and increasing its competitiveness in international market. will use modern techniques of production. will introduce accountability and responsibility in PSUs

It

It

Privatization encourages growth of monopoly power in the hands of big business houses. This results in greater inequalities of income and wealth.
Private enterprises may not show any interest in buying shares of sick PSUs.

 Private

sector produces with profit motive and have no consideration for social welfare motive. sector is not interested in those projects which take long time to complete and have low profitability. This includes water supply, salt, production, education for poor, etc. sector is not interested in taking up risky projects.

Private

Private