Topics Covered: Effects of liberalization on the economy, changes in industrial policy and their effects on industrial growth.
New ‘Public Sector Enterprise Policy’:
The government recently released a new ‘Public Sector Enterprise Policy’.
Under the New Policy:
- Strategic: Atomic energy, space, defence, trans and telecom, power, petro, coal, other minerals, banking, insurance and financial services will be classified as strategic sectors.
- Privatization: The remaining companies in strategic sectors will be considered for privatization/merger/closure and non-strategic sectors will be considered for privatization, where feasible or for closure.
- In strategic sectors, the minimum presence of existing companies at the holding level will be retained under government control.
- The strategic sectors have limited number of players restricting it to maximum four public sector enterprises of the holding nature.
Having a robust disinvestment policy would be critical for the government at a time when it needs resources to bridge the fiscal gap and for spending on key policy initiatives to battle Covid-19 pandemic affected economy.
Sources: the Hindu.