Q.State the meaning of privatization.

This question needs only the precise core definition of privatization, without needing to list its various forms.

Privatization refers to the transfer of ownership and/or management of public sector enterprises (businesses owned and run by the government) to the private sector. More broadly, it can also describe any reduction in the direct role the government plays in owning and operating economic enterprises. It was pursued mainly to improve efficiency and reduce the fiscal burden of loss-making public enterprises on the government.

Students sometimes confuse privatization with disinvestment specifically — privatization is the BROADER term covering disinvestment, strategic sale, and contracting out; disinvestment is only ONE form that privatization can take.