Question

Disinvestments refers to

• A. reimbursement of investment
• B. withdrawal of investment
• C. further investment
• D. none of these

Hint:

Break the word into 'dis' and 'invest': the prefix reverses investing, so it means pulling investment out, not adding to it.

Answer 1

The Correct Option is B

The word "disinvestment" is built from "invest" with the prefix "dis", which usually means the opposite or reversal of an action. In the Indian economic context, disinvestment refers to the government selling its shares or stake in public sector companies, which means it is pulling money and ownership out rather than putting more in. Let's check the options.

1. reimbursement of investment: Reimbursement means getting money back that was already spent for a specific purpose, which is a different idea from selling off an ownership stake.
2. withdrawal of investment: This matches disinvestment exactly: the government (or any investor) pulls out its existing investment, usually by selling shares or assets.
3. further investment: This is the opposite of disinvestment, since it means adding more money, not taking it out.
4. none of these: Not needed, since option (2) fits.

Since disinvestment means taking out or reducing an existing investment, usually by selling a stake, the correct option is "withdrawal of investment".

Let's summarize:

• The prefix "dis" reverses the meaning of "invest", so disinvestment means pulling investment out.
• In India, this usually means the government selling its shares in public sector companies.

The answer is option (2).