Economy and Analysis
Privatization and ATMA NIRBHAR BHARAT ABHIYAN - Are we moving towards more liberal and open economy?
When PM Modi announced the package of 20 lakh crores, there everyone was brimful of hope that we will finally get something to help ourselves.
But as the saying goes, you need to face your enemies, either real or concocted and one such concocted enemy for Indians is the fear of privatization, which has been planted in their minds for communist literary works, by communist model worker’s association and by a mentality that one can earn good and be stable only with Government Job.
In the 4th part of the ATMA NIRBHAR BHARAT ABHIYAN scheme, the Finance Minister announced various schemes to allow private players in the fields where earlier either there was a state monopoly or certain restrictions.
Earlier there was a government monopoly in the coal sector but under prevailing circumstances, the government has decided that the introduction of private sector participation has become inevitable to enhance competition.
Some important decisions that were taken are:
- Nearly 50 coal blocks will be offered immediately.
- A revenue sharing mechanism shall be introduced instead of fixed rupee/tonne.
- Production earlier than scheduled will be incentivized through rebate in revenue share.
- 1 billion ton coal production by Coal India till 2023-24.
- Infrastructure development of ₹ 50,000 crores which will include 18000 crores in the mechanised transfer of coal using a conveyor belt.
In the mineral sector, 500 mining blocks will be offered through an open and transparent auction process. There will be a joint auctioning process for coal and bauxite mineral blocks to enhance competitiveness in the aluminium industry. This decision was welcomed by leading employers of the field including Vedanta.
The Government has planned to ban the strategic imports in a calibrated way and self produce them within the territory of India under the Make in India scheme. It will make India self-reliant in defence. FDI in the defence sector from automatic route has been increased from 49% to 74%. The government also expects to reduce the heavy import bills for defence equipment. The corporatisation of the Ordnance Factory Board has been proposed to improve the functioning and enhance competitiveness.
Civil Aviation Sector
Restriction on the usage of Indian Air Space will be eased so that civilian flights become more efficient. This move is estimated to bring a profit of around 1000 crore. 6 Airports have been identified for the 2nd round of bidding for operation and maintenance on the Public-Private Partnership (PPP) model. Additionally, 1st and 2nd round investment in the 12 Airports is estimated to bring in about 13000 crores. 6 more Airports will be put out for the 3rd round. India is expected to become a global hub for Maintenance, Repair and Overhaul(MRO).
The tax regime for MRO has been liberalised. This industry is expected to increase from 800 crores to 2000 crores. Major engine manufacturers are expected to shift their repair facilities in India and this will lower the repair cost of planes.
The government aims to boost private partnership in space activities. For this, the sharing of Geospatial data for providing remote sensing data has been liberalised and tech-entrepreneurs can use it soon.
Railways have been one of the most controversial terrains when it comes to a public-private partnership. Government has announced that 151 private trains will run on 109 routes by 2023. The state has also assured the citizens that the security and time table along with various other facilities will still be provided by railways only.
These trains are expected to be semi-high speed (up to 160 kmph) trains with various modern facilities. Government has promised that they will not run only private trains during peak hours and citizens will always have the option to travel by Trains of Indian Railways. Railways have already invited requests for qualification. This move is expected to bring in investments worth 30000 crores.
All these moves are aimed at creating various job opportunities for the general public if this works.
After a long time policy of state monopoly in various fields, the government has started taking the constitution seriously and providing equal opportunities to every private entity to trade and do their business freely.
Once during Budget Speech, Finance Minister said that this country from now on will not look down on the employers and people who pay high taxes, in other words rich, as they invest and create jobs for others and this is high time that we as citizens take the word of our elected representative seriously and start building the nation to make ourselves ATMA NIRBHAR.