Privatization in India Essay Example for Free

Privatization in India raiseRam Mohan Visiting Faculty, Finance and Accounting Area Indian Institute of Management Ahmedabad, India Abstract The proposed query is intended to survey the process of privatization in India and assess its dissemble on the Indian economy. The central offspring we will address is the impact of privatization that has taken place so far on profitability and carrying into action of PSUs. Going beyond this, we will attempt to understand what explains the impact of privatization on performance.Is it the use of market king by oligopolistic firms whose pricing power had been constrained under government ownership ? Is performance bought at the spending of labour through extensive layoffs so that what we see is essentially a transfer from workers to shargonholders ? Or are we confusing the impact of privatization with the more generalised impact of deregulation in the economy, which in itself could spur skill ? The research output will comprise the follow ing 1. A survey of the literature on privatization, in particular with respect to less developed countries. 2.A review of the role of the public sector in the Indian economy, and the process of economic liberalization and privatization in India upto this point. 3. Impact of privatization on firm performance. 4. Explanation for the impact of privatization 5. judgment of mechanisms of corporate governance in India. -2- I. Background privatization in theory and practice A great curl of privatization has swept the world in the past two decades, embracing the industrial economies, the transition economies of East atomic number 63 and large parts of the less developed world, and it continues to roll on.It is interesting, however, that its basis in theory was somewhat skew-whiff to start with. Moreover, a sizable enough body of empirical evidence, on which hypotheses about its impact could be tested, became available only several years down the road. So much of the initial impetus to privatization entailed a leap in faith, and, as happens all too often in the development of knowledge, attempts to explain its impact have followed on the heels of widespread existing practice.