ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Public Enterprises and Private Purposes

Public Enterprises and Private Purposes Ramaswamy R Iyer I HAVE read with considerable interest Sudip Chaudhuri' s article 'Public Enterprises and Private Purposes' (EPW, May 28). At the outset (particularly in view of the criticisms I am going to make later in this note) let me establish my credentials as a friend and not a foe of public enterprises (PEs). As Secretary of the Economic Administration Reforms Commission (the Jha Commission) I played a not unimportant role in the preparation of its reports including four on PEs (three of which have been cited in the references at the end of Chaudhuri's article). I also made a systematic attempt in my book A Grammar of Public Enterprises: Exercises in Clarification (Rawat Publications, Jaipur, 1991 , under the auspices of the Centre for Policy Research, New Delhi) to analyse and dispel the persistent confusions, errors and fallacies that characterise much of the thinking and writing about PEs. (Chaudhuri, who too has tried to discuss some wrong assumptions about PEs, has probably not seen my book.) 1 am broadly in agreement with Chaudhuri's proposition that PEs have not received the right kind of support from the government. (The fact that PEs have in the past had relatively easy access to capital funds, from the government budget does not imply 'the right kind of support1.) I am also in agreement with the thesis that PEs have been used for private purposes. This was so particularly from the mid-70s onwards when a process of subversion of all institutions began, and as a part of that process PEs came to be regarded as channels through which money could be collected (for whatever purposes), and also as instruments through which certain political purposes could be served. As a corollary, appointments to the top posts in important' PEs began to be governed by considerations other than those of the requirements of the job. While those tendencies perhaps abated somewhat later on, it cannot be said that they have disappeared; in fact some of them have become common form and have lost the power to shock.

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