There has been a lot of pep talk with little actually being done on the crucial issue of PSU reforms more specifically _ the disinvestment. However, the process is no smooth ride when it comes to implementation. The latest controversy, about Balco, would prove to be a litmus test for government to show its willingness and guts to push through further disinvestment and PSU reforms.

The disinvestment of Balco is one of the first mega ventures of its kind that the Government of India has undertaken. Since this is a big PSU put up for sale and more importantly, this is the first major PSU disinvestment where the Government was giving up a majority stake to a private company the deal assumes significance. A decade of economic reforms saw very little activity on the disinvestment front. Tall promises were seldom put into action. For 1999 the budget pegged disinvestment proceeds at Rs.10, 000 crore but all that was achieved was a meager Rs.105 crore from the disinvestment of Modern Foods to FMCG Major, HLL.

The process came to a virtual standstill after that with no other company offered for sale for quite some time. In fact, the disinvestment of India's massive public sector undertakings has largely been written off as a disaster. The industrial community, which had patiently waited to see if they would get a chance to own these prized possessions, has slowly given up the idea. Then came the Balco deal in the fag end of February just before the budget for the current year was presented. The disinvestment ministry would have had nothing to its credit if not for Balco for the whole year of 2000-2001. Nevertheless, even now the situation seems no better with the deal stuck up in a muddle that might take quite some time to be cleared.