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Do you think that privatization serve the public interest? Justify your arguments with suitable examples.

HINTS

You are free to say YES or NO in similar questions. What matters more is the ease of justifying from your knowledge level.

Option 1- YES- Privatization serves public interest:

Yes, I agree with the view that privatization serves public interest. Privatization refers to inclusion of private sector participation in management and ownership of public sector enterprises.

Justification

  1. Improved efficiency is ensured with less political interference

Eg: British air ways

  1. Increased healthy competition for better results.

Eg: Telecom services like jio and airtel.

  1. Quality of service delivery will be improved.

Eg: Door step banking service.

  1. Spur innovation without fiscal burden.

Eg: SpaceX space missions.

  1. Pressure from shareholders forces company to work well than government machinery.

So privatization of non-strategic sectors serves public interest.

Option 2- NO, Privatization wont serve public interest:

No, I dont agree with the view that privatization serves public interest. Privatization refers to inclusion of private sector participation in management and ownership of public sector enterprises.

Justification:

  1. No guarantee of success: Many private players faced huge loss.

Eg: Kingfisher airlines.

  1. Job losses: Reducing number of labors and increased automation to reduce cost.
  2. Wealth distribution: Increases gap between rich and poor.
  3. Externalities problems: Focus will be on profit

Eg: Pollution, spoiling environment.

  1. Abuse of public interest: for their own benefits.

Eg: Cutting expensive remote services.

  1. Monopoly: Leads to concentration of decision making power.

Even though privatization have benefits, it cant be said that it serves public interest. Hence government should hold sufficient control to avoid monopoly which will be counterproductive.

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