The above is article from HINDU Editorial page. Following are | ECONOMY by VIVEK SINGH

The above is article from HINDU Editorial page. Following are some relevant points.

1) The Washington Consensus (coined in 1989) refers to a set of broadly free market economic ideas, supported by prominent economists and international organisations, such as the IMF, the World Bank and the US Dept. of Treasury (all based in Washington).

2) In 1979, Mrs Thatcher was elected Prime Minister of the UK. At the time, the UK was experiencing double-digit inflation, trades unions were powerful and there were signs British industry was becoming increasingly uncompetitive. Mrs Thatcher introduced revolutionary economic policies which had a deep impact on the UK economy. They were characterised by a belief in free-markets, an effort to reduce state intervention in the economy, privatisation of PSUs, reduce the power of trade unions and tackle inflation.

3)
Benefits of Privatisation:
(a) Brings in efficiency through private management
(b) Govt. can focus more on delivery of basic public services like health, education, infra rather than running PSUs to produce coal, gas, steel, airlines etc.
(c) Reduction in fiscal deficit and debt (it is a byproduct of privatisation rather than the main objective)

Disadvantages of Privatisation
(a) There are very few big private firms and their resources are limited which could be used to buy out bankrupt private firms (through IBC) rather than PSUs. Otherwise it will result in slowing down the turnaround (making a company profitable) of bankrupt private firms
(b) The big firms can be encouraged to invest in greenfield and brownfield projects to revive the economic growth momentum
(c) Govt. achieves various social objectives through the PSUs like providing jobs through reservation, guaranteed procurement from MSMEs, opening of accounts through PSBs, Lending etc.

4)The author in this article has suggested that we should nurture our PSUs also as done in China. (China's growth was driven by combination of both private and public firms). But this is doubtful in case of India because of the differences in our political system and other socio cultural differences and we have experienced this also in the last 70 years of our post independence history.