The United Progressive Alliance government on Monday said it will pursue privatisation of public sector firms on a case-by-case basis and, as a policy, sell-off or close loss-making companies while giving autonomy to profit-making ones.
"The government is committed to a strong and effective public sector, whose social objectives are met by its commercial functioning. But for this, there is a need for selectivity and a strategic focus," President A J P Abdul Kalam said, addressing a joint session of the Parliament.
"My government will devolve full managerial and commercial autonomy to successful, profit-making companies operating in a competitive environment," he said.
Privatisation, he said, would be considered on a case-by-case basis.
The Congress-led government would encourage public sector companies and nationalised banks to enter the capital market and raise resources and offer new investment avenues to retail investors.
"Chronically loss-making companies will either be sold-off or closed, after workers get their legitimate dues and compensation. Private industry will be inducted to turnaround companies that have potential for revival," he said.
"My government believes that privatisation should increase competition, not decrease it. We also believe that there must be a direct link between privatisation and social needs, like the use of revenues generated through privatisation for designated social sector schemes," he said.