Disinvestment is :
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → Privatisation of public sector
Option (1) Privatisation of public sector — Correct. The government is trying to sell its share in several public sector companies, a process known as disinvestment. As the shares pass to private owners, the companies are privatised; ‘Modern Foods’, set up by the government to make cheap bread, was the first company to be privatised.
Option (2) Nationalisation of private sector — Incorrect. Nationalisation means the government taking over private companies. Disinvestment is the opposite: the government gives up its ownership.
NCERT (2025-26): “Globalisation, Liberalisation and Changes in Indian Industry … The government is trying to sell its share in several public sector companies, a process which is known as disinvestment. Many government workers are scared that after disinvestment, they will lose their jobs. In ‘Modern Foods’, which was set up by the government to make healthy bread available at cheap prices, and which was the first company to be privatised, 60% of the workers were forced to retire in the first five years.…” |