Principal Economic Adviser, Sanjeev Sanyal also said that the government will not shy away from creating new public sector entities wherever necessary.
Defending the privatization policy, Principal Economic Adviser Sanjeev Sanyal on Saturday said that most of the public sector undertakings (PSUs) that the government intends to sell were actually created by the private sector.
Stating that this government is adamant about privatization, he said, “You (opposition) made the point that this (PSU) is made up of blood and sweat of the public sector. So, let me put the record straight on this: In fact a lot of what we are trying to privatize was actually created by the private sector.”
Giving an example he said Air India It was simply withdrawn from the private sector and was nationalized in 1993.
“In 1969, banks were simply delisted and nationalized. So, when people say that these institutions are made of the blood and sweat of the Indian bureaucracy, let me tell you that these things are basically private companies. was created by him,” he said. Said at the India Today Conclave.
He said that Finance Minister Nirmala Sitharaman has already outlined the strategic and non-strategic sectors for the purpose of privatization and the government will have minimal presence in the strategic sector.
He also said that the government would not hesitate to set up new public sector units if needed.
Giving the example of setting up a Development Finance Institution (DFI), he said the government has recently created the National Bank for Financing Infrastructure and Development (NABFID) to meet large infrastructure needs.
Talking about the banking sector, he said that it is part of the strategic sector and the government will have a presence in this sector.
“There are some reasons you want to do this… The fact is that there are problems with private sector banking as well. We have seen some examples of Yes Bank and so on. So, this is one area where you can do this as a public sector bank. Attendance is also required,” he said.
He noted that many countries around the world have retained some public banking systems, or even nationalized in the case of the global financial crisis.
Last year, the capital-starved Yes Bank was put under a moratorium and its board was superseded. Several agencies are probing the frauds committed by the then management.
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