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Ublic AND Private Sector Presented By:-Jayashree. Komal Agrawal Harshit Hardik

The document discusses the public and private sectors in India. The public sector is organized and controlled by the government to serve national interests. It was seen as a tool for implementing socialist ideology after 1948. The public sector aims to boost growth, develop infrastructure and strategic industries, create jobs, and achieve balanced regional development. It has played a large role in the Indian economy but some public sector undertakings have faced losses due to issues like price controls, underutilization, and management problems. The private sector is run by individuals or groups for profit and not controlled by the state. It exists in various legal forms and its development helps economic growth and poverty reduction. The joint sector involves partnership between the state and private promoters.

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38 views25 pages

Ublic AND Private Sector Presented By:-Jayashree. Komal Agrawal Harshit Hardik

The document discusses the public and private sectors in India. The public sector is organized and controlled by the government to serve national interests. It was seen as a tool for implementing socialist ideology after 1948. The public sector aims to boost growth, develop infrastructure and strategic industries, create jobs, and achieve balanced regional development. It has played a large role in the Indian economy but some public sector undertakings have faced losses due to issues like price controls, underutilization, and management problems. The private sector is run by individuals or groups for profit and not controlled by the state. It exists in various legal forms and its development helps economic growth and poverty reduction. The joint sector involves partnership between the state and private promoters.

Uploaded by

Surya Reddy
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPT, PDF, TXT or read online on Scribd
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PUBLIC AND PRIVATE SECTOR

Presented by:Jayashree. komal agrawal Harshit Hardik

PUBLIC SECTOR
It is that part of business activity that is organised and controlled by the government or its agencies on behalf of the nation as a whole 1948 policy made it clear that the public sector is going to play a dominate role in Indian economy Public sector was seen as the tool to implement socialist ideology of govt.

EXAMPLE

Central Government Parliament Government Departments education, defence, etc. Devolved Governments Other public funds - Foreign exchange reserves, Quangos Quasi Autonomous Non-Governmental Organisations now referred to as Non Departmental Public Bodies, e.g. Equal Opportunities Commission, Advertising Standards Authority, Competition Commission, English Heritage Local Government Public Corporations Post Office BBC

THE RESOLUTION OF 1948 DIVIDED


THE INDUSTRY INTO FOUR GROUP
Manufacturing of Arms and ammunition ,atomic energy and management of railway Manufacturing of coal , iron and steel , aircraft, shipment building, telephone ,telegraph and wireless apparatus Industry of such basic importance that the central govt. would fill it necessary to plan and regulate them The reminder of the industrial field , left open to private enterprise , individual as well as cooperative

OBJECTIVES OF PUBLIC SECTORS


To impetus the economic growth and to boost industrialization in country . o To develop infrastructure. oTo develop strategically important areas in the interest of nation as railways , telecommunication , nuclear power , defense etc. oTo check the concentration of economic power oTo create employment opportunities. oTo have balance regional development of country
o
o

To

produce import substitutes To promote redistribution of wealth and income To invest in those areas where private investors are not ready to invest either because of low ROI, high risk , large gestation period or because of lack of technology To utilize the natural resource of country in the national interest To ensure easier availability of articles of mass consumption , to check prices of important articles etc.

ROLE OF PUBLIC SECTOR IN INDIAN


ECONOMY

Capital formation Employment Share of public sector in GDP Development of infrastructure Strong industrial base Export promotion Import substitution

Removal

of regional disparities. Raising internal resources. Contributor exchequer. Reducing inequalities in the economy.

REASON FOR LOSSES IN PSU

OF THE VARIOUS FACTOR RESPONSIBLE FOR


LOW PROFIT IN PUBLIC SECTOR UNDERTAKING ARE

Price policy of public sector undertaking Under-utilization of capacity Problem related to planning and construction of projects Problem of labour, personnel and management

OTHER PROBLEMS
Objectives

Frequent

changes in mangment Selection of long sites Nationalization of loss making units. Autonomy

POLICY REGARDING PSU IN ERA OF


LIBERALIZATION
Reduction

in the reserve item Memorandum of understanding Referring to BIFR National renewal fund Privatization/ disinvestment Strategic and non-strategic classification

PRIVATE SECTOR
The private sector is that part of the economy which is run by private individuals or groups, usually as a means of enterprise for profit, and is not controlled by the state.

LEGAL STATUS
A

variety of legal structures exist for private sector business organizations, depending on the jurisdiction in which they have their legal domicile. Individuals can conduct business without necessarily being part of any organization. The main types of businesses in the private sector are: Sole trader Partnership, either limited or unlimited liability Public Limited Company shares are open to the public. Two examples are:

LEGAL STATUS.
Private

Limited Company or LTD-limited liability, with private shares Franchise business owner pays a corporation to use their name, receives spec for the business Workers cooperative all workers have equal pay, and make joint business decisions In countries where the private sector is regulated or even forbidden, some types of private business continue to operate within them.

PRIVATE SECTOR DEVELOPMENT

Private Sector Development (PSD) is a strategy for promoting economic growth and reducing poverty in developing countries by building private enterprises, membership organizations representing them, and competitive markets that are stronger and more inclusive

APPROACHES TO PRIVATE SECTOR


DEVELOPMENT
Business

environment reform Where entrepreneurship and markets are stifled by inappropriate regulation, excessive taxation, lack of fair competition, lack of voice or an unstable policy environment, growth and poverty reduction are likely to suffer. Typically, donors first fund business environment analyses, such as the World Bank's Doing Business Reports, identifying the major constraints to business growth. They then work with government and other stakeholders to implement reforms.[4]

Women's

entrepreneurship development In many parts of the developing world, women are systematically excluded from business opportunities. Discrimination can disadvantage women in their access to the knowledge and skills needed to be successful in business. At the same time, laws that disadvantage women in gaining access to property can make it hard for women to raise the necessary capital.

Local

economic development LED typically starts by analysing the economy of a particular region or municipality, identifying opportunities to enhance its prospects. LED strategies may combine any of the following: business environment reform, value chain development, infrastructure development, innovation and technology policy, planning and/ or skills development..

JOINT SECTOR IN INDIA


o

Joint sector means partnership between the state and private promoter. General public hold the large majority of shares in this but do not control the affairs of the company The chairman of the company is a nominee of the government and the managing director is a representative of the private promoter

It

came during the post-1970 peroid. The view came from the memorandom submitted by J.R.D TATA. It suggested that the governments participation will not be less than 26 percent The day-to-day management will normally in the hands of the private sector partner Control and supervision will be exercised by the government Central government involve in joint sector only when project require large funds and smaller ones leaves to state government.

EXAMPLES
Air

india international Madras fertilizers Ltd. Maruti udyog Ltd.

INDUSTRIAL POLICY RESOLUTION (IPR) OF 1956


It

classified industries in to 3 main categories 1. Schedule A 2. Schedule B 3. Non-scheduled

GUIDELINES TO OPERATIONALISE THIS


POLICY
1.

2.

3.

The state industrial development corporations(SIDC) hold a minimum of 26 percent in the equity capital of the companies. No private partner holds equity capital more than the SIDCs except with the prior approval of the central government No large industrial house(LIH) or foreign majority company can have any holding at all in the projects promoted by SIDCs except with the prior permission of the central government.

THANK YOU

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