Government should go forward on privatisation

What really plagues privatisation and other liberalising moves is the public discourse, which remains essentially socialistic.

With the Narendra Modi government showing intent and urgency to privatise public sector undertakings (PSUS), one would expect a big boost to reforms and, consequently, economic growth and development. There is little scope for complacency though, for an array of forces is determined to stall the sale of PSUS.

Strange it may sound but the reality is that the most entrenched and dogged are some among the Sangh Parivar. So, a few weeks ago, the Rss-affiliated Bharatiya Mazdoor Sangh (BMS) announced a phased stir from 15 March to 11 November against the privatisation.

The BMS’ PSUS Coordination Committee recently talked about “the onslaught of the government” on PSUS. Another Sangh outfit, the Swadeshi Jagaran Manch (SJM), is also against the government’s disinvestment programme.

On the face of it, the rhetoric may appear a shenanigan to keep its pro-worker image intact (for some esoteric reason, being against liberalisation is regarded as pro-people and pro-worker). The truth, however, is that many saffron warriors are ideologically opposed to privatisation; they have always been against it, as we shall see. So, they may not be feigning when they rail against the sale of PSUS.

It may be recalled that when the Bharatiya Janata Party-led government under Atal Bihari Vajpayee was selling off PSUS, it faced maximum resistance from the RSS, not the Left. The then RSS chief, K. Sudarshan made it clear that he was against the free market policies adopted by the government. A cabinet member, George Fernandes, put his foot down over the issue of the privatization of BPCL and HPCL; he was fully supported by the RSS.

Even when those opposing it couldn’t stop the sale of PSUS, they did obstruct the process. A prominent saffron ideologue, who is now on the board of the Reserve Bank of India, actively campaigned against privatisation.

In a nutshell, it would be unwise to downplay the destructive role that some can play in checking privatisation in particular and liberalisation in general.

Unfortunately, saffron activists are not the only ones who hate the idea of privatization. The All India Bank Employees Association (AIBEA) has announced a countrywide strike on 15 and 16 March against the proposed sale of two state-run banks. “Conciliation meetings were held between the representatives of government and the unions on March 4, 9 and 10,” AIBEA general secretary C.H. Venkatachalam told the media. “We were ready to reconsider... if the government agreed to defer its decision to privatise two PSBS [public sector banks].”

The privatisation drive may be constrained by another factor—hesitancy of the key functionaries concerned to carry it out. The minister in charge of the sale of PSUS during the Vajpayee era, Arun Shourie, is still dogged by charges of corruption. This is despite the fact that all state-run companies were openly auctioned; the process as well as the transactions were scrutinized by the Comptroller & Auditor General and courts, and no illegalities were found in the transactions.

What really plagues privatisation and other liberalising moves is the public discourse, which remains essentially socialistic. Capitalism is equated with “exploitation” (all of us have read this in our schools and colleges), private enterprise is accused of “profiteering” and worse, and the sale of PSUS is routinely called “selling family silver to pay the grocer’s bill”. With political debate getting conducted in a Leftist phraseology, the climate of opinion is anything but conducive for privatisation.

The Prime Minister, however, seems set on privatisation. “It is government’s duty to support enterprises and businesses. But it is not essential that it should own and run enterprises,” he said at a webinar on privatization by the Department of Investment and Public Asset Management (Dipam) on 24 February.

The Prime Minister-headed Niti Aayog has reportedly asked administrative ministries to create a pipeline of assets that can be monetised in the next four years. The Aayog is “preparing a schedule for the sustained sale of assets and companies to be privatised. On its own, Niti Aayog has already identified about 100 assets, valued at about Rs 5 lakh crore, that will be put on the fast track, said a senior government official. “Around 31 broad asset classes, mapped to 10 ministries or central public sector enterprises, have been developed,” the official told the Economic Times.

Putting privatisation “on a fast track” is good but not enough; the government should also be ready for the roadblocks that would be put on the track.

More than anything else, Modi has to beware the ides of March, for many in the Sangh Parivar are doctrinally committed to the totally discredited left-wing theories.

Isn’t a nation doomed where the right follows the left?

Ravi Shanker Kapoor is a freelance journalist.