Q. Which method achieves privatization in India’s disinvestment policy?
Answer: Reducing government equity below 51% with management control transfer
Notes: Disinvestment in India involves selling government shares in Public Sector Undertakings. Strategic disinvestment or privatization generally refers to reducing government equity below 51% and transferring management control. This policy was formally introduced in the 1990s. The Department of Investment and Public Asset Management oversees such transactions. The 2021 Budget targeted privatization of select PSUs through equity sale and transfer of management.
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