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Q.Assertion (A) : The government sells its shares in several public sector companies as part of the process of disinvestment. Reason (R) : Many government workers are scared that they will lose their job after disinvestment. (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.

CBSECBSE Class XII Board 2026MCQ· 1mImportance★★★★★
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Both the assertion and the reason are true, but the reason does not explain the assertion — disinvestment is a fiscal and efficiency measure, not a response to workers’ fears.

The assertion is straightforward: as part of India’s economic reforms since 1991, the government has indeed sold its shares in many public sector undertakings (PSUs). This is the core of disinvestment — reducing the government’s equity stake in state-owned companies, sometimes to a minority holding, sometimes to zero. The stated objectives have been to raise revenue for the exchequer, reduce the fiscal burden of loss-making PSUs, bring in private-sector efficiency, and widen public ownership. So Assertion (A) is clearly true.

The reason is also true, but in a different sense. Many government workers — employees of PSUs — have genuinely feared job losses after disinvestment. When a PSU is partially or fully privatised, the new private management often restructures operations, which can lead to voluntary retirement schemes, downsizing, or changes in service conditions. This fear has been real and has sometimes led to political opposition and strikes. So Reason (R) is factually correct.

Note

The fear of job loss is not universal — some PSU employees have benefited from better pay and growth prospects after disinvestment — but the anxiety has been widespread enough to be a notable social and political factor. …

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