“Navratan Policy of the government has helped in improving the performance of Public Sector Undertakings in India.”
Do you agree with the given statement? Justify your answer with valid arguments.
Ans.
Disagree:
The Navratna Policy of the government aimed to enhance the autonomy and competitiveness of select Public Sector Undertakings (PSUs) in India by granting them greater operational and financial freedom. While it may have brought some improvements in certain PSUs, overall, its impact on improving the performance of PSUs has been mixed. Several factors contribute to this assessment:
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Selective Impact: While some Navratna PSUs have shown improvements in their performance metrics such as profitability, efficiency, and market competitiveness, not all PSUs under the policy have experienced similar outcomes. The effectiveness of the policy varies across different companies based on their management practices, market conditions, and sectoral challenges.
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Management and Governance Issues: Many PSUs continue to face challenges related to bureaucratic control, political interference, and inefficiencies in management and governance. These issues hinder their ability to operate competitively and adapt to changing market dynamics, limiting the effectiveness of the Navratna Policy in driving performance improvements.
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Market Liberalization: The liberalization of the Indian economy since the 1990s has exposed PSUs to increased competition from private sector companies, both domestic and international. While the Navratna Policy aimed to enhance competitiveness, PSUs still struggle to compete effectively in sectors where private players have greater agility, innovation, and efficiency.
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Technological Obsolescence: Many PSUs grapple with technological obsolescence and outdated infrastructure, hindering their ability to remain competitive in rapidly evolving industries. The Navratna Policy may not adequately address these challenges, limiting its impact on overall performance improvement.
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Policy Implementation Issues: The successful implementation of the Navratna Policy requires effective monitoring, evaluation, and accountability mechanisms to ensure that PSUs utilize their enhanced autonomy responsibly and achieve tangible performance outcomes. However, shortcomings in policy implementation and oversight may undermine its intended objectives.
