D

OSSIER

Department of Computer Science & Information Technology /

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Privatization
Privatization is the incidence or process of transferring ownership of business from the public sector (government) to the private sector (business). In a broader sense, privatization refers to transfer of any government function to the private sector including governmental functions like revenue collection and law enforcement. The term Privatization also has been used to describe two unrelated transactions. The first is a buyout, by the majority owner, of all shares of a public corporation or holding companys stock, privatizing a publicly traded stock. The second is a demutualization of a mutual organization or cooperative to form a joint stock company Privatization of industries means opening the gates of public sector to private sector. it enhances the role of private sector as private sector plays significant role in the economic development of the country. THUS WE SAY TRANSFERRING OF PUBLIC SECTOR INDUSTRIES TO PRIVATE SECTOR IS CALLED PRIVATISATION augment private profit, to increase productivity and efficiency of the enterprise.

After Privatisation

Conversion of Flea Market into Shooping Malls

Features of Privatisation

Objectives of Privatisation

1. Ownership Measures 2. Operational Measures 3. Organisational Measures 1. 2. 3. 4. 5. Disintegration of socialist economies. Inefficient public sector. Uneconomic privacy policy. Burden on the government. The privatisation is to increase efficiency and competetiveness among industries, to

Causes of Privatisation

To increase the efficiency and competitive power of the enterprise To reduce deficit financing and public deficit. To strengthen industrial management T earn more and more foreign currency To make optimum use of economic resources and diffuse their ownership. To achieve rapid industrial development of the country

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Ef fect on W orld Economics Before and Effect World After Privatisation
BEFORE AFTER

OSSIER

ICICI Bank Limited Housing Development Finance Corp. Ltd. TATA Steel Limited

Merits of Privatisation
1. 2. 3. 4. 5. 6. 1. 2. 3. 4. 5. 6.

reduction in economic burden increase in the efficiency reduction ion the sense of irresponsibility scientific management reduction in political interference encouragement to new inventions

Demerits of Privatisation Top Private Companies in India

Reliance Industries Limited Tata Consultancy Services (TCS) Infosys Technologies Ltd Wipro Limited Bharti Tele-Ventures Limited ITC Limited Hindustan Lever Limited

industrial sickness lack of social awareness class struggle increase in inequality increase in unemployment ignores weaker sections

Abhinav Gupta
2nd year (07CS102)