The Hindu : New Delhi News : PSU revival finds appreciation

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Tuesday, Nov 17, 2009
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PSU revival finds appreciation

C. Gouridasan Nair

NEW DELHI: The success that Kerala has achieved in turning around nearly three-fourths of the Public Sector Units (PSUs) under the State Industries Department has come in for praise from academicians, experts and top bureaucrats.

From Cabinet Secretary K.M. Chandrasekhar to Prime Minister’s Principal Secretary T.K.A. Nair and Planning Commission member Abijit Sen, there are many who find in the Kerala experience in revival of State-owned enterprises a model replicable elsewhere.

Participating in a national conference on ‘Resurgence of State-owned enterprises: the Kerala experience,’ organised by the State Industries Department here on Monday, they pointed out that though small in terms of profitability figures, the State’s achievement deserved to be studied in depth and documented so that others could emulate the example. Mr. Chandrasekhar noted that what Kerala had achieved over the last three years was due mainly to the pragmatic approach adopted by the political leadership, effective interventions from those manning the department and the relative autonomy granted to the public sector enterprises.

On its part, the Union government too had been experimenting with autonomy of management of PSUs, he pointed out.

Mr. Nair said the sense of direction and realism shown by the State government in managing the public sector enterprises were praise worthy.

Praising the State for its achievement, Prof. Sen said the challenge would now be to ensure sustainability of the good performance. Focus must also be given to the fact that the units with employment generation potential, such as those in the textiles sector, were yet to be turned around, he said. Amiya Kumar Bagchi, Director, Institute of Development Studies, Kolkata, said Kerala’s success in making the PSUs profitable was significant because it has come at a time when it was more fashionable to talk about privatising public sector enterprises.

Political will

Earlier, inaugurating the conference, State Planning Board Vice-Chairman Prabhat Patnaik said what was noteworthy about Kerala’s achievement was that PSUs had been made profitable within a very short period of time. More significantly, they had been ‘turned around’ without in any way compromising their public sector character, without adopting any of the rapacious methods associated with private monopoly capital and without even using any of the usual strategies for ‘turning around’ that were commonly employed by private monopoly capital.

“The ‘turn around’ has been achieved without any recourse to land speculation, let alone land grab, without any large-scale retrenchment of workers, and without any recourse to financial manipulations or jugglery. It has been achieved essentially by streamlining management and operations, and this has become possible only because the political will for doing so has been achieved,” Prof. Patnaik said.

On growth path

Chairing the inaugural session, Industries Minister Elamaram Karim said the PSUs in the State were firmly on the growth path. T. Balakrishnan, Principal Secretary, Industries, said that as many as 37 out of the 41 PSUs under the department were expected to turn profitable during the current year.

Public Sector Restructuring and Internal Audit Board (RIAB) Chairman John Mathai, corporate management expert Y.R.K. Reddy, among others, spoke.

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