There’s something rotten in India’s public sector enterprises (PSEs). Although by definition they are owned by the public and all citizens are shareholders, in reality they are the private sector of commissions-hungry politicians and bureaucrats, and those who work in the 256 Central PSEs and an equivalent number owned by state governments.
Failure to deliver promised surpluses for investment in rural development and social welfare (public education and health) apart, PSEs have earned a notorious reputation for contracts-rigging, bribery and short-changing ancillaries, intermediates suppliers and bottom-of-pyramid citizens who are their shareholders.
This latter proclivity of PSE babus was recently highlighted in a case filed by one Shakraji Thakor against the public sector crude oil quasi-monopoly Oil and Natural Gas Corporation (ONGC) for “forcible occupation” of his farmland on the outskirts of Ahmedabad for 23 years. Thakor (no relation, note the spelling) contended that ONGC has been paying him “meagre rent” for over 20 years and refusing to vacate the land or acquire it at market price. An irate bench of the Gujarat high court has directed the chairman of ONGC (annual income: Rs.6.39 lakh crore) to file an affidavit to explain the corporation’s failure and negligence. This high-handedness doesn’t surprise your correspondent. Some five years ago when a main road in Bangalore was under repair, LIC shut its gates to ensure that the public — its shareholders — didn’t use its forecourt as an alternative route. Your correspondent was roundly abused for claiming shareholder’s right.
My rule to never subscribe to PSE equity shares or do business with them has paid off. Given their business practices, it’s a rule that’s served me well.
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