(a) Public sector undertakings have been the bedrock of welfareism in India for many decades. Evaluate the pros and cons of…

(a) Public Sector Undertakings and the Current Disinvestment Scenario

Post-independence, Public Sector Undertakings (PSUs) served as the bedrock of welfarism in India, under the Industrial Policy Resolutions of 1948 and 1956, institutionalising state-led development through employment generation, affirmative action, balanced regional equity, and self-reliance in core strategic sectors. However, mounting fiscal stress, public sector inefficiencies and the 1991 liberalisation prompted a shift from minority stake sales to strategic disinvestment, managed by the Department of Investment and Public Asset Management (DIPAM, so renamed in 2016). The New Public Sector Enterprise Policy (2021) retains only a bare minimum presence in four broad strategic sectors and envisages privatisation or closure elsewhere.

Pros and Cons: Disinvestment unlocks public capital trapped in commercial enterprises, redirecting resources toward public infrastructure and capital expenditure. Transactions such as the privatisation of Air India to the Tata group (2022) and the LIC IPO (2022), India’s largest at the time, show the potential for non-tax revenue mobilisation, deeper capital markets and improved corporate governance through listing. Asset monetisation under the National Monetisation Pipeline (2021) extends the same logic without transferring ownership.

Conversely, rapid disinvestment strains the welfare mandate. It directly contracts organized public employment, eroding constitutional reservation benefits for marginalized communities. Selling profitable assets generates concerns regarding asset stripping and undervaluation, while stalled transactions like the BPCL strategic sale (called off in 2022) expose vulnerability to market conditions. Receipts have repeatedly fallen short of budget targets, and since 2024 the Union Budget no longer shows a separate disinvestment target, signalling a shift towards value creation in PSUs through dividends and listing. Furthermore, unchecked divestment in sensitive domains poses national security concerns and weakens sovereign supply chains during crises.

Verdict: Disinvestment is an effective fiscal and managerial tool, but it must not become a short-term revenue-balancing mechanism. A balanced approach requires safeguarding strategic national assets, ensuring transparent valuation, and ring-fencing disinvestment proceeds exclusively for human development and social capital.

(b) The Collegium System: Independence versus Accountability

The appointment of higher judiciary judges transitioned from executive primacy under Articles 124(2) and 217(1), affirmed in the First Judges Case (S.P. Gupta, 1981), to judicial primacy through the Second Judges Case (Supreme Court Advocates-on-Record Association, 1993) and the Third Judges Case (1998). This established the collegium mechanism comprising the Chief Justice of India and four senior-most judges to insulate the judiciary from political interference and preserve the basic structure.

Contemporary Debates: While the collegium has fortified institutional independence, it has attracted severe debate over transparency, accountability, and the absence of a constitutional check. The executive's effort to replace it via the National Judicial Appointments Commission (NJAC, 99th Amendment Act, 2014) was struck down by the Supreme Court in 2015 (the Fourth Judges Case) to protect judicial primacy, though the Court itself acknowledged the need to improve the collegium.

This has resulted in recurring friction between the executive and judiciary over the Memorandum of Procedure (MoP), delay in clearing reiterated collegium recommendations, and selective acceptance of intelligence inputs. Consequently, high judicial vacancies persist, especially in the High Courts, aggravating the national pendency crisis. Concerns over diversity, since few women and judges from marginalised groups are appointed, and over accountability, sharpened by the 2025 controversy over cash found at a High Court judge’s residence that led to an in-house inquiry and removal proceedings in Parliament, have kept the debate alive. The Supreme Court has responded with measures such as publishing collegium resolutions (from 2017) and, in 2025, judges’ asset declarations and appointment data.

Way Forward: Safeguarding independence does not preclude institutional transparency. Establishing a permanent institutional secretariat, publishing objective selection matrices, and formalizing fixed timelines within the MoP will reconcile judicial independence with administrative accountability.

(c) Bureaucratic Authoritarianism as a Model of Non-Democratic Rule

Formulated by political scientist Guillermo O’Donnell (Modernization and Bureaucratic-Authoritarianism, 1973) to explain military-led regimes in Latin America (Brazil after 1964, Argentina after 1966, and Chile and Uruguay after 1973), the 'Bureaucratic-Authoritarian' (BA) state is a distinct model of non-democratic rule. It is characterized by an institutional coalition between high-ranking military officials and civilian technocrats.

Key Characteristics and Distinctions: The BA model enforces the political and economic exclusion of the popular sector, systematically depoliticising civil society and labour unions. O’Donnell linked its rise to the exhaustion of easy import-substitution industrialisation, which intensified class conflict and pushed elites to seek order and foreign investment. Governance is driven by technocratic rationality, where orthodox economic stabilization, austerity, and capital accumulation are prioritized over democratic distributive claims and social justice.

Unlike personal dictatorships driven by charismatic despots, military juntas focused purely on coercive rule, or totalitarian regimes that enforce mass ideological mobilization, the BA state governs through depoliticized administrative insulation and bureaucratic institutionalism. In modern public administration, the concept explains the perils of technocratic overreach, where participatory democracy and constitutional accountability are sidelined in the pursuit of administrative and economic efficiency. Critics, in David Collier’s edited volume The New Authoritarianism in Latin America (1979), questioned the economic causation, and the model lost relevance as these regimes democratised in the 1980s, but it remains a key reference for understanding technocratic authoritarian rule.