What are the primary economic objectives of disinvestment, and why are options a, c, and d incorrect explanations?

You're on a roll — Disinvestment, also known as privatization, is a process where the government sells its stake in public sector undertakings (PSUs) to private entities. The primary economic objectives of this policy, especially as pursued by the Indian government since the 1991 economic reforms, are multifaceted. Option a is incorrect. Disinvestment is about selling government assets, not about banning foreign investment. In fact, the 1991 reforms generally aimed to liberalize the economy and encourage foreign investment. Option c is incorrect. Privatization often aims to increase* competition in markets by allowing private players to operate in sectors previously dominated by public monopolies, not to eliminate it. Option d is incorrect. Nationalization is the opposite of disinvestment; it involves the government taking over private companies. Disinvestment is about the government reducing its ownership in public companies. The main objectives of disinvestment are to generate revenue for the government (thereby reducing the fiscal burden or deficit) and to improve the efficiency and performance of public enterprises by introducing private sector management, technology, and capital. Many PSUs were incurring losses or operating inefficiently, and privatization was seen as a way to revitalize them and make them more competitive. Therefore, the correct option is b. The primary economic objective of disinvestment (privatization) as pursued by the Indian government is: b. To reduce fiscal burden and improve efficiency of public enterprises through partial or full sale. The final answer is b One more to go today! Send it over 📸