Privatization is the process of transferring ownership of a business enterprises, agency, public service or public properly’ from the public sector to the private sector.

Political implications of liberalization are as follows:

1. Concentration of wealth: Privatization encourages concetration of wealth in the hands of big business group. It results in great disparities of income and wealth. It goes against the principle of egalitarian society.

2. More profits: Corporate sectors generate more profits. But they share a meagre percentage with the share holders. They enjoy the lion’s share out of share holder’s investment. As a result, the gap between the rich and the poor is widened.

3. Bane to local industries: Local people borrow money from indigenous banks and also get loans from government concerns with subsidized rates of interest to start an industry. Multi-national Companies with good financial backup, survive even in case of loss.

4. Threat to National interest: Key areas like national defence, space, science, and technology are to be retained with the Government. Assigning these areas to private sector harms national interests.

5. Lack of service motto: The private firms are concerned more about their profit rather than providing good service conditions and extending welfare programmes to their employees and even to the society.

6. No job security: Private companies extract work from employees till they are fit. The Companies ruthlessly sack them when they suffer from ill health or fitness problems. In the long run, they become a burden on the government. The employees of private sectors suffer from the insecurity of jobs and this results in psychological disorders.