UPSC Prelims 2011 · Question 10 of 100
UPSC Prelims 2011 question on Cpse Disinvestment Rationale
- ExamUPSC CSE
- Year2011
- PaperGeneral Studies Paper I
- SubjectIndian Economy
- TopicPublic Finance
- DifficultyMedium
- TypeStatement
Why is the Government of India disinvesting its equity in the Central Public Sector Enterprises (CPSEs)?
1. The Government intends to use the revenue earned from the disinvestment mainly to pay back the external debt.
2. The Government no longer intends to retain the management control of the CPSEs.
Which of the statements given above is/are correct?
Show answer
Answer: D. Neither 1 nor 2
Verdict
Correct statements: Neither I nor II → Option (d).
Statement by statement
Statement 1 – Incorrect: Disinvestment proceeds are not mainly for repaying external debt.
Statement 2 – Incorrect: Government may retain management control even after disinvestment.