Opinion - Letters to the Editor   

On the public sector

By highlighting the problem of bureaucracy and media bias against PSEs the article, "In defence of public sector enterprises" (June 22), has exposed how the public sector has been done in, in a systematic manner. Even today, it is the public sector that delivers the basic services, be it water, electricity, transport, health or education to the majority. Unless public-spirited citizens and trade unions take pro-active steps, irreversible damage can be inflicted on PSUs. We need more examples like state-owned electricity distribution companies of Andhra Pradesh, and the Akshay Prakash Yojana of the Maharashtra Government.

N. Sreekumar,
Pune

The Government should reiterate its commitment to a mixed economy and ensure that the public sector is given a level-playing field to operate. There is a common perception that government policies favour private operators at the cost of PSUs.

Arvind Pal Dahiya,
Rohtak, Haryana

The public sector has served the country well in core areas such as railways, post, city transport, scientific research, and education. However, its monopoly in telecommunications, aviation, banking, etc., did impact on its performance vis-à-vis the common man. Its foray into business ventures has only spelt disaster and led to the wastage of taxpayers' money.

R. Narasimhan,
Chennai

The author's holding up of French and Italian government-owned companies as good examples is questionable. In both countries there are numerous examples of state-run companies enjoying quasi-monopoly positions, offering poor customer service and under-performing. The governments have openly meddled with business decisions, are often held hostage by powerful lobbies and unions and the impact is seen in key macro-economic indicators such as poor GDP growth and rising unemployment.

Just as the private sector companies do not have an automatic right to profits, the public sector enterprises need not be doomed to persistent losses. Management quality and accountability play a major role in success. Reckless government and political interference is probably the root cause of underperformance in PSEs, resulting in enormous wastage of taxpayers' money and the perception that they have no role to play in India's future.

Rajesh Krishnamurthy,
Simsbury, Connecticut

The author has based his conclusions only on the Central public sector undertakings, ignoring the abysmal record of PSUs under State Governments. In many cases, the entire capital base of the companies has been eroded by accumulated losses. The CAG reports have brought out year after year glaring instances of wastage, excess payments, cost and time overruns, bad planning, irregular awards of contracts for works and purchases, and so on. The article also makes certain sweeping remarks about the ideological mindset and reading habits of civil servants. While civil servants may also have to answer for some of the ills that plague the PSUs, politicians are not entirely free from blame.

S. Gurumurthy,
Chennai

The article is incorrect in saying that private sector banks carry no responsibility to provide credit on a preferential basis to farmers and small-scale industries. Private banks are required to lend a percentage of their total loans to agriculture, small enterprises and to the priority sector. While the public sector banks lend directly to these sectors because of their wide network, private banks deposit the difference between the amount they are supposed to lend, arrived at as a percentage of their total loans, and the loans they actually make, to Nabard for agriculture lending and Sidbi for SSI lending.

M. Mandal,
Hyderabad

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