Abstract
The process of disinvestment is going on not only in India but also in China, Russia, Brazil, Taiwan, Hungary, Thailand, Philippines, Korea, Turkey, Poland, West Asia, Zambia and Vietnam . Object of disinvestment is to reduce the financial burden on the government, improve public finances, introduce competition and market discipline, funds growth, encourage wider share of ownership and depoliticize non-essential services. Disinvestment improves corporate governance, develops and deepens the capital market through spread of equity culture, enhances corporate governance with the induction of independent directors developing and deepening of capital market, developing infrastructure, defence, education, healthcare and law and order. Private sector involves in PSUs by disinvestments. There are a lot of merits in private sector. In private sector, the decision-making process is quick, decisions are liked with the competitive markets changes. In private sector, better corporate governances, exposure, competitive corporate responsibility and transparency are found. The loss making PSUs can be successfully revived by asking the strategic partners to infuse fresh capital and exercising excellent management control over sick PSUs.
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