Posts Tagged ‘Economic policy’

Centre To Go Ahead With PSUs Disinvestment :)

Prime Minister Manmohan Singh reiterated that Centre will go ahead with the disinvestment in public sector undertakings (PSUs).

Prime Minister Manmohan Singh reiterated that Centre will go ahead with the disinvestment in public sector undertakings (PSUs).

While efforts will be made to recover loss-making units, the Centre will go ahead with the disinvestment in public sector undertakings (PSUs) stated Prime Minister Manmohan Singh.

However, this is said :

–ย  to unlock the true value of a company,

– improves its corporate governance standards and

– also help it in raising resources for funding future expansion plans.

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Additionally, several PSEs are entering the capital markets striving to become active global players.

At the same time several PSEs got their shares listed on the markets in the last 2 years and many more want to do so, showing they are not shying away from market scrutiny and are ready to face new challenges.

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Further, stressing the need for strengthening the public sector, MMS said that the government was committed to restructure and recover sick and loss-making PSUs.

Moreover, amount of Rs. 15,250 crore is provided by the government in the last 5 years as cash and non-cash support to 36 such enterprises.

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On the other hand, stating that the Centre was committed to giving PSUs flexibility and autonomy to operate effectively in a competitive environment, MMS stated that they have delegated more powers to the boards of Navratna and Miniratna companies.

This was done in order to facilitate improvement in their performance, implemented revised salaries for executives of public sector enterprises and introduced innovative measures like performance related pay.

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Stock Markets to be Propelled by the NTPC Stake Sale :)

stake sale in NTPC is expected to propel the stock markets :)

Stake sale in NTPC is expected to propel the stock markets ๐Ÿ™‚

The government’s nod for stake sale in state-run power utilitiesNTPC and SJVNL – is expected to bolster investor sentiment and propel the stock markets in days to come, experts said.

The Cabinet Committee on Economic Affairs (CCEA) has approved five and 10 per cent disinvestments in NTPC and SJVNL respectively.

Government seems to be confident and ready to adopt a more liberalised economic policy and looks like committed to increase investors’ wealth, experts said.

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Marketmen believe, a follow-on public offer (FPO) of NTPC, the second most valued public sector unit with a market capitalisation of over Rs 1.77 lakh crore, would help increase trading volumes at the counter.

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PSU stocks generally have less volume and low volatility.
The market would now look at the issue price of the FPO and an increase in demand would help to shore up supply,” SMC Global Vice President Rajesh Jain said.

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Meanwhile, it is expected that the stake dilution would increase liquidity in the scrip and would help in reducing the fiscal deficit of the economy, but it may at the same time, act as a dampener on the stock price.

However, experts are waiting for the entire structure of the issue to be released for further clarity.

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NTPC shares are currently trading around Rs 216 a share levels.

Given the current market conditions, the company would be able to mop up around Rs 8,500 crore through the stake sale.

After five per cent stake dilution, the government’s holding in NTPC would come down to 84.5 per cent from the current 89.5 per cent.

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Why India will not become a superpower?

Why India will not become a superpower?

1. Population:

India’s increasing population is a big hindrance in India’s becoming a Super power. Rising population has affected the quality of life of the people for sure as imparting access of basic amenities and education to bigger population becomes more difficult. In the last several decades, fertility control policies in India have failed to promote a sustainable solution to the problem of overpopulation. India needs to take strict measures to counter the prevailing birth rate in the country.

2. Corruption:

India is one of the most corrupt countries on the world map. Corruption in India has assumed such large proportions that public have come to believe that it is impossible to get rid of this malaise.

We need variety of strategies to fight corruption, ranging from the simplification of rules and procedures and the application of information technology to specific steps such as trapping corrupt public servants. Open and transparent political systems are must at all levels.

3. Decline of public institutions:

key institutions like โ€”politics, universities, judiciary, bureaucracy, police etc. are witnessing deterioration on the matter of accountability and productivity. In India, average incomes have risen fourfold and yet public institutions have not improved. Indian policy makers need to come up with number of public institutional reforms steps to counter this malaise.

4. Naxal and Maoist menace :

Extremism in the form of the Naxalite movement has to be checked. Stern and sincere steps should be taken to rein in the menace.

Rehabilitation programme has to be launched to bring the Naxalites into the mainstream and at the same time police force should be given modern training and equipments to counter ultras.

5. Social inequality and Unequal distribution of income across society:

India needs to address growing unequal income distribution and need to narrow the gap between the poor and rich . This disparity has only increased over the years. Economic policy makers need to work on this. The present global financial crisis is bound to make matters worse unless long-term structural reforms are adopted.

6. Environmental degradation:

Economic development without environmental considerations can cause serious environmental damage in turn impairing the quality of life of present and future generations. The degradation is impacting people’s lives in very real ways, whether in the form of massive depletion of underground aquifers, chemical contamination of soil, death of rivers, loss of species etc.

7. Religious extremism :

Current trends shows Religious extremism has risen sharply in Indian society and if not taken care of, they have potential to completely destroy the secular and democratic fabric of the nation.

Religious riots, communal clashes and bombings in every nook and corner of the country are hindrance in the set up of secular fabric, scientific advancements, technological breakthroughs in the country. Matured democracy and vibrant, fast-growing economy like INDIA have to deal with this issue ASAP.

8. Media Apathy :

Indian media has failed to cover all relevant and real issues revolving around our society. Media needs to come up with the coverage of real and main issues like social inequality and environment degradations. Media has to play an active role in spreading awareness among masses towards major issues of the society.

9. Political chaos :

The political fragmentation across central and regional levels makes it very difficult to forge sustainable long term policies in the realm of health, education, infrastructure etc.

10. Border conflicts:

India’s unresolved border disputes, especially in Kashmir and the North East (Nagaland and Manipur) which indicates that there are parts of India that are not comfortable with being part of India. India needs to take proactive steps to resolve the conflict and fasten the development in these disturbed territories.