Why should the public sector enterprises be privatised?
The prime reason for privatising public sector enterprises is that the government should be focussing on public goods such as law and order. It must concentrate its resources on improving governance, providing health and education and improving infrastructure rather than dissipating its energies on running liquor shops and making watches. To achieve that it must get out of doing those things which the private sector can do equally efficiently (or better). The government should, in the first place, have been present only in instances where the market failed. However, since India has a legacy of socialism where the government tried to do everything itself, we have the public sector enterprises in various businesses. Even today half of the output in the organised sector is produced in public sector enterprises.
