The BJP government has always been vocal in favour of privatization. This also reflected in the 2021 Budget that called for privatization of various PSBs and PSUs. This calls for a genuine demand to weigh the pros and cons of the idea as it has the potential to leave an everlasting impression onto the Indian economy.
One must not generalize and see the privatization of PSUs and PSBs based upon the same parameters. The Government companies have a genuine need of the ‘Government having no business being in business’ thus calling for private participation which along with it would bring better skills, technology, management and discipline. Also, these companies must put more emphasis on profits. When a company does well, it also becomes a driving force for the development of the area where it is located, this being magnified by initiatives like the ‘Corporate Social Responsibility’. However, making these a part of Government welfare projects is unfair as it can cost us the opportunity of competing as a leader at the world stage.
But, this same argument cannot be applied in case of banks. Here privatization can’t take place following a simple distinction of critical and non-critical sectors. It is the finances being dealt with here. Banks are a medium of monetary interaction between the people of India and the guardians of the economy and thus demands utmost trust from the masses. Giving their money to the private sectors to handle can invite the fear of channeling of financial resources towards profiteering by these. Also, the fear of exclusion of a large part of the population from approaching the bank and rising NPAs exist. Data shows the NPAs held by private banks are much more than the government ones. The country also saw the panic created by the ‘Yes Bank’ and ‘PMC Bank’ issues showing that private ownership doesn’t guarantee financial safety.
This doesn’t intend to ignore the deteriorated work environment in both the PSUs and the PSBs equally. The solution to this isn’t simple too as no amount of fear in government servants could replace the very desire to progress seen in private players. Stricter management, rigid deadlines, performance based promotions comprise the former. Also, the strikes that happen so often in Government owned entities push us back onto the path of progress. This explains why since 1969, when the Indira Gandhi government nationalized 4 banks, we haven’t achieved as much as our capacity. Thus, it is time that Government employees show more dedication to the roles and responsibilities assigned to them than the love for their ‘Sarkari naukri’. Also, the Government instead of going for privatization could explore the options of strategic disinvestment and PPP models. All this needs to be accompanied with efficient audits which demands hard work in dealing with the hard earned money of the common people. Critical review of every decision is the first step towards achieving that.