Question 2.

Does the structure and growth of public sector matches with its
objectives? Explain with the help of an example.

Introduction
Objective of Public Sector
Structure and Growth of Public sector
Case study
Conclusions
References

Introduction
India after independence following a path of British rule , the national government
followed a soviet union model of mixed economy for India economic development .
Both private and public sector were given due considerations for making contribution to
Indian economy. How ever in terms of policy perspective , the public sector was
overweighed and was assigned much greater role to play in strengthening the overall
economy . According to article 39(b) and (c) of the constitution of india The ownership
and control of the material resources of the community are so distributed as best to sub
serve the common good and that the operation of the economic system doesnot result
in the concentration of wealth and means of production to the common detriment.
Public sector was expected to achieve commanding heights in the economy and it did
over a period of 40 years, however the quantitative growth was not matched by
qualitative performance and many public enterprises were incurring losses.
Objectives of Public Sector
In a developing country like India ,some industries need to be brought within public
ownership and control in order to achieve rapid economic growth . Public enterprises
became an essential part of economic development programme in India .It was justified
by the statement that the rate of economic development planned by the government was
much higher than achieved by private sector.
The public sector was entrusted with following objectives.

To help in rapid economic growth and industrialization of the country and create
necessary infrastructure for economic development
To earn return on investment and thus generate resources for development
To promote redistribution of income and wealth

To create employment opportunities

To promote balanced regional development
To assist the development of small scale and ancillary industries
To promote import substitutions , save and earn foreign exchange for the
economy
To generate forces of economic and technological self reliance.

Structure and growth of public sector

Case Study