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Name: Nikhil Johri: Mail: nikhil.johri09@gmail.

com: Roll No: BPCA6A040

The Government has no Business Being in Business


When we talk about business, we tend to make a primary assumption that its
basic objective is to generate profit out of the money invested, but when we look
at how the government usually runs its businesses we come to find anomalies in
its fundamental approach. Many of the government organizations and its units
keep running even after being under severe losses. We can look at Indian
Railways, Air India, Public sector banks such as SBI, Bank of India, etc. and at
Public sector units such as BHEL, NTPC, etc. The reason being, these organization
are run by government not with the primary objective to earn profit, but to serve
employment and infrastructural growth opportunities to the nation. So, when we
say Government has no business being in business we are actually not quite right.

Governments with the help of such organizations create the nation from the
ground level. We can look at Indian Railway, though it runs under loss, but
without it the nation will paralyze, as it is not just the biggest employer of India,
but also is the primary means of commuting. Although, many steps can be taken
to bring the railway back on track by privatization of goods trains, by speeding up
movement of trains and by separating tracks for the commercial and public
purposes.

Similarly, we can look at the Public sector banks, which today are facing huge debt
crisis, as NPAs (Non-Performing Assets) have increased dramatically, amounting
to more than Rs. 3 Lakh Crores. Nearly, half of which comes from the loans being
provided to rich businessmen without a proper background check of their assets
and liabilities. This is an example of poor management of its money by the banks,
but we also have to look at the other half NPAs which are due to non-revival of
payments from small loans to the farmers and small businesses and enterprises
and banks have to bear these losses for the public to survive in cases of extreme
poverty and losses.

From quite a while, we also have been hearing news of Government owned Public
Sector Undertakings (PSUs) being shut down due to long term losses and lack of
relevance in the present scenario. Some of these PSUs have already been shut
down including the famous HMT (Hindustan Machine Times) which was shut
down because of lack of vision in present scenario. We can see that
manufacturing watches is not much of a relevant job undertaken by the
government in present scenario. Similarly, many PSUs showing negative growth
for most of the time are being shut down.

Government always looks forward to indulging in businesses which have shown


potential in the development of the nation. It had shut down organizations which
have lost relevance with the changing needs of the nation, it has always been
looking for relevance to serve the people and it will always remain in the business
which will serve meaning to the people of the nation.

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