7

Disinvestment of Public Sector Undertakings

Chapter Objectives

This chapter will enable you to develop an understanding of the following:

  1. What is disinvestment

  2. Why disinvestment of PSUs in India

  3. The PSU sell-off methods

  4. Proceeds realised from disinvestment

  5. Evaluating the disinvestment programme

  6. Disinvestment of PSUs in different countries

INTRODUCTION

Central public sector undertakings (PSUs) are organisations established by the government of India as government companies under the Companies Act or as statutory corporations under specific statutes of parliament.

After independence, the government realised that the process of industrialisation needed enormous amount of capital which was beyond the financial capability of the private sector. ...

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