| Assertion [A] Selling of part of an equity of the PSEs is called disinvestment. |
| Reason [R] The main reason for disinvestment is to keep all the operational units of the country under the private sector. |
A) Both Assertion [A] and Reason [R] are true and Reason [R] is the correct explanation of Assertion [A]
B) Both Assertion [A] and Reason [R] are true, but Reason [R] is not the correct explanation of Assertion [A]
C) Assertion [A] is true, but Reason [R] is false
D) Assertion [A] is false, but Reason [R] is true
Correct Answer: C
Solution :
The purpose of disinvestment was mainly to improve the financial discipline and facilitate modernisation. It was argued that private capital and managerial capabilities could be effectively utilised to improve the performance of loss making PSUs.
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