When public sector pride became a national drag

Summary: A new book revisits India’s long, messy experiment with public sector enterprises. And its conclusions are uncomfortable. From chronic cost overruns to decades of subpar returns, the numbers reveal how deeply this legacy still shapes corporate India. We break down the insights most relevant for today’s investors. Political scientist Devesh Kapur and former chief economic adviser Arvind Subramanian have a new book, A Sixth of Humanity: Independent India’s Development Odyssey. It’s about India’s many worrying development failures, such as the inability to provide jobs to the masses, without which economic growth cannot leap. This is why the growth in per capita GDP lags countries that started at similar points; continuing poor performance relative to other nations on adult heights, an indicator of well-being, as well as school learning outcomes. There’s much to agree with and disagree with in the book. But one chapter that makes an important point with which there can be no quarrels is about public sector companies. This data-driven discussion is especially interesting for investors who hold listed public sector companies in their portfolios, for it brings out the staggering mismanagement and sub-par financial performance of this group as a whole, even if select companies perform well because their market share goes unchallenged mainly by private competitors, on the back of government policies that don’t allow

This article was originally published on December 01, 2025.