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Section : Economics
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India\'s Economic EMERGENCY?-2
 
Money that we're paying for a better, stronger economy...is almost thrown down the drain through these loss-making public sector enterprises.

By Vivek Kaul




Economic Emergency Warning Sign #1: 
The Public Sector Money Pit

Just take a look at the following table on the evolution of Public Sector Enterprises in India...

Year 
1951 India had Five Public Sector Enterprises
1985 India had Two Hundred Public Sector Enterprises
1992 India had Two Hundred Thirty-Seven Public Sector Enterprises
2015 India had Two Hundred Ninety-Eight Public Sector Enterprises

Now, I'll not even get into discussing why a government needs to be in business...

In fact, Modi himself reiterated the old adage - Government Has No Business Being In Business, during his US visit in 2014.

So, even the government believes that it needs to get out of these loss-making public sector companies.

But the questions remain...

  • Why aren't we closing these loss-making Public Sector Companies?
  • Why is the government not following up on its divestment promises?
  • Why are they shuffling ownership between government enterprises?

In fact, at last count, the government owned almost 300 businesses.

And right now, I want to show you the Big Government Action that's hidden these Public Sector Companies.

In these Public Sector Enterprises are companies that are supposed to manufacture...

  • Bicycles
  • Condoms
  • Scooters
  • Fertilizers
  • And absurdly enough, even Photo Films.

Yes, on Page 83 of this book you will find how our Big Government actually wasted crores in running a business that is supposed to manufacture Photo Films.

Photo films that have already gone obsolete.

And as expected, the business faced a loss of Rs 2,164 crore in just 2014-15.

And then, we also have businesses like...

  • Mahanagar Telephone Nigam Ltd. (MTNL), a telephone company that had incurred losses of close to Rs 5,000 crore between April 1, 2014, and March 2016. (revealed on page 44)
  • Air India. An airline that has incurred losses of thousands of crores over the years. In 2014-2015 alone, the airline lost Rs 5,860 crore. (revealed on page 89)
  • Bharat Sanchar Nigam Ltd (BSNL), another telecom company which incurred a mindboggling loss of Rs 8,234 crore in 2014-15. (details onpage 46)

Now you can imagine how much of our hard-earned tax money has the Big Government wasted on these companies over the years.

Money that we're paying for a better, stronger economy...is almost thrown down the drain through these loss-making public sector enterprises.

Every rupee that goes towards sustaining these companies is taken away from some other, and arguably more important, area.

In fact, in just 2014-15, these businesses lost a whopping 27,360 crore!

The top loss-incurring government companies during 2014-2015.

Sr. No.Name of CompanyLosses (in Rs.crore)

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