Articles by Prajapati Trivedi

Prajapati Trivedi The debate on privatisation in India has been more ideological than pragmatic; more dogmatic than analytical and more bureaucratic than technocratic. This study attempts to piece together various policy pronouncements and publicly available documents on this subject to outline what appears to be the prevalent approach to privatisation.

No one can say that the Memorandum of Understanding (MOU) is a panacea for public sector ills, nor can anyone claim it is perfect in its design as well as in its implementation. But it is an improvement over all known previous efforts and represents a step in the right direction. Much work needs to be done to improve it further, notwithstanding the fact that it has achieved a great deal in a short period of time and is regarded to be in the vanguard of such efforts internationally INTRODUCTION THE recent article by Murthy [1990] on the policy of Memorandum of Understanding is a typical 'good news-bad news' story. The good news is that it signals an increase in the level of interest and awareness regarding the existence of the MOU policy' The bad news is that it is, unfortunately, factually quite inaccurate and betrays a surprising lack of clarity regarding the current status of the MOU policy. As we shall see later in this critique, the subtitle of the paper: 'More Memorandum than Understanding' is more true for the article by Murthy than for the MOU policy, if correctly understood.

Memoranda of Understanding Prajapati Trivedi Following the recommendation of the Arjun Sengupta Committee, the government of India decided to adopt a system of Memorandum of Understanding (MOU) in 1986, These MOUs were supposed to outline the mutual obligations of the government and public enterprises. As of now, eleven public enterprises have signed MOUs with their respective administrative ministries and six more will be added to this list in the next round. It is fair to say, the policy of MOUs is one of the major initiatives of the government towards the public sector in India. Yet, there has been a certain degree of dissatisfaction, both within and outside the government, over the functioning of the MOU system as it has prevailed over the last two years. It was, therefore, decided that a thorough review and revamping of the system should be undertaken. While performance improvement requires action on several fronts, a proper system to evaluate public enterprise performance is a critical element of any such effort. This paper presents a pro- cedure for fixing performance criteria in MOUs and evaluating the performance of a public enterprise based on these MOUs. The proposed system has been derived after examining the international experience in this regard. According to the available information, the proposed system appears to be the most successful. After discussing the conceptual aspects of a 'desirable' performance evaluation system, the paper examines the MOU of ONGC for illustrating the difference between the existing approach and the one proposed in this paper.

A number of major policy initiatives toward public enterprises are being pushed vigorously by the government. Phrases like "MOUs" ''holding companies" and "privatisation" have become a part of the current economic jargon. A closer examination reveals that they have spawned out of a common source