01-08-2012, 10:39 AM
GROWTH AND PERFOMANCE OF PUBLIC SECTOR IN INDIA
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PUBLIC SECTOR
Public sector includes all state owned enterprise. These are owned and managed by the government. Government has full control over these enterprises. The objective of these enterprises is to perform social welfare along with earning profits.
ROLE OR SIGNIFICANCE OF PUBLIC SECTOR
Contribute to net domestic product : Share of public sector in NDP has tended to increase over time. It was just 11% in 1992 while in 2007 it was 22%
Basic industries: It is only through public enterprise that we can lay strong foundation for basic industries in india like iron and steel
Development of infrastructure: Devlopment of infrastructure comprising to transport , power , communication etc.
Export promotion : Public sector in india has promoted exports of the country. Public sector exports consist of railway ingiePne , steel etc.
Promote employment: Public sector are generating more and more employment opportunities .
Help in growth of small scale industries: Public enterprises are very large in size. These enterprises purchase various raw material from SSE.
MAIN DEFECTS OF PUBLIC ENTERPRISES
Lack of efficiency : Efficiency of public enterprises is generally lower than private enterprises because of poor management.
Social objectives: Public enterprises do not have profit maximization as there sole objective as but social welfare is also considered as the objective of public enterprises.
Effect of location: A private enterprises is located at place that suits the objective of profit maximization.
Long gestation period: Most of the pub sector enterprises are large and capital intensive. So that these enterprises have long gestation period.
Lack of competition: Lack of competition is an important obstacle n the way progresses of public sector enterprises.
Irresponsible labour : In public sector workers are generally indisciplined and corrupt. They are hardly conscious of there responsibilities.
MESURES AND SUGGESTIONS FOT THE IMPROVEMENT OF PUBLIC SECTO
Reforms in the BOD: It is advised that various board of management for the public enterprises should be suitably reformed.
Proper auditing: Accounts of public enterprises should be properly audited time to time.
Reforms in labour policy: Labour policy of public enterprises should also be properly designed.
Inspection of public enterprises: Public enterprises are inspected by public accounts committee and estimated committee.
Commercial outlook: Public enterprises must adopt commercial outlook. These should be coordination between national interest and profitability.
Increase in efficiency: Public enterprises should increase there efficiency level. BY
There should be proper R&d department of there enterprises .
There should be proper intensive for raising the level of production.
PUBLIC SECTOR REFORMS IN NEW INDUSTRIAL POLICY 1991.
In place of 17 industries 3 industries have been reserved for public sector.
44 central public sector enterprises are listed n domestic stock exchange.
In july 1991 the gov. declared 11 major public sector undertaking as navratans but presentaly there are 18 navratans.
Public enterprises will be made more efficient through the medium of MEMORANDOM OF UNDERSTANDING.