Image: Economic Times
The All India Trade Union Congress (AITUC) called for a nation-wide protest of all trade unions on September 28, 2020 against the Centre’s decision to privatise the Public Sector Units (PSUs.)
General Secretary of AITUC Amarjeet Kaur called the government decision an “anti-national policy” that would lead to the suffrage of multiple public sectors.
She said the public sectors consist of Indians and to give these departments to the private corporates with low prices damages the country’s economy. Within the public sector, the strategic and core sectors were built to avoid India’s dependence on other countries. Privatisation could make the departments dependent on multinational corporations which threatens India’s sovereignty.
The General Secretary argued that the public sector is a role model in addressing the employees’ needs and grievances. It provides social security, maternity and health benefits – all of which the private sector fails to ensure. Thus, she said that corporatising these sectors would send the country’s economy in a backward direction.
Illustrating her point with examples she talked about the consequences of privatising public transport sectors and energy sectors.
Public transport like railways serve as a relief to common people. By privatising railways, the corporates will privatise their own trains, not considering the interests of civilians.
Similarly, coal and electricity are vital elements for the progress of a nation. Schools, hospitals, small-scale industries are all dependent on electricity. However, privatising the distribution system of amenities like electricity would annul the welfare schemes that provided subsidies to the backward sections.
“The point is that employment will now be precarious, especially for the common person. This is no longer just about the employees,” said Amarjeet Kaur.
Same as the AITUC, Unions such as the All India Bank Employees’ Association (AIBEA) also intend to hold a public demonstration against the Centre’s plan. The AIBEA announced September 14 as the Anti Bank Privatisation Day to protest the privatisation of government banks.
He said that privatisation of this department has time and again proved to be a bad idea because private banks tend to look out for themselves. Unlike foreign banks, Indian banks are more deposit-oriented. This will change once the ownership changes from the government to private companies.
“In banking, profits are related to risks. If the privatised banks try to make profits, they will attempt a huge risk and the casualty will be the people of this country,” said Venkatchallam.
He emphasised that banks have a socio-economic meaning in India. Moreover, public banks ensure safe utilisation and protection of money and create job opportunities. Neither of these aspects are guaranteed in privatised banks, said Venkatchallam.
He also pointed out that government banks provide farm loans essential for rural development. Since such investments do not garner huge profits, the private sector is less likely to offer these loans.
He also questioned the idea that banks should be privatised for viability because 97 percent of the bad loans incurred by the government banks belong to private entities.
“Simply recover the bad loans to recover the public sector. But banks must be allowed to serve the public,” he said.
On the other hand, economist and Chairperson of the Jawaharlal Nehru University’s Centre for Informal Sector and Labour Studies Dr Santosh Mehrotra argued that the government may have no other way than to privatise the public sector. He said that privatisation cannot be viewed as a mere black and white issue. Instead, each sector listed in the government’s PSU list needs to be considered individually. He gave the example of Air India that would be hard-pressed for a reason not to be privatised.
In case of banks, he pointed out that the Centre has been unable to solve the issue of Non-Performing Assets NPAs) to the extent that the Reserve Bank of India (RBI) has already begun planning for higher NPAs in the future.
“If government doesn’t divest government banks then how will they compete with private banks,” he asked.
Regarding the privatisation of the electricity distribution system, he pointed out that many parts in this sector had already been privatised. Additionally, the Electricity Boards had proved to be inefficient.
Referencing such incidents, he said that the discussion should focus on whether the individual department served as a burden to the current economy. The first priority was to ensure the proper growth of the economy which the current government has failed to do. Thus, the collapse of job growth brought us to such a situation.
When asked about the protests by the employees in the public sector, Mehrotra said that the shedding of workers should be done in a humane manner but that the current economy had made the protests inevitable.