Public Enterprises Essay

What atomic number 18 the Objectives of national Enterprises? SOUMYA SINGH In India, public enterprises have been assigned the task of realising the objectives laid down in the Directive Principles of State Policy. familiar celestial sphere as a whole seeks (a) to gain control of the commanding heights of the economy, (b) to promote critical development in terms of amicable gain or strategic value rather than on consideration of profit, and (c) to provide commercial surplus with which to finance further frugal development. The main objectives of public enterprises in India are as follows 1. Economic development unrestricted enterprises were set up to accelerate the rate of economic growth in a planned manner. These enterprises have created a sound industrial base for rapid industrialisation of the country. They are expect to provide infrastructure facilities for promoting balanced and change economic structure of development. 2. Self-reliance Another aim of public enterprises is to promote self-reliance in strategic sectors of the national economy. For this purpose, public enterprises have been set up in transportation, communication, energy, petro-chemicals, and other key and basic industries. . Development of backward Areas Several public enterprises were established in backward areas to reduce regional imbalances in development. match development of different parts of the country is necessary for hearty as well as strategic reasons. 4. Employment generation Unemployment has be perform a austere trouble in India. humanity enterprises seek to offer gainful employment to millions. In order to protect jobs, several sick units in the private sector have been nationalised. 5. Economic surplus mankind enterprises seek to generate and mobilise surplus for reinvestment.These enterprises earn money and mobilise public savings for industrial development. 6. egalitarian society An important objective of public enterprises is to prevent concentration of ec onomic power and growth of private monopolies. Public sector helps the presidential term to enforce social control on trade and industry for ensuring equitable distribution of goods and services. Public enterprises protect and promote small scale industries. 7. Consumer eudaimonia Public enterprises seek to protect consumers from exploitation and profiteering by ensuring supply of essential commodities at cheaper prices.They aim at stabilising prices. 8. Public utilities Private sector is guided by profit motive. Therefore, it is antipathetical to invest money in public utility services like water supply, gas, electricity, public transport. Therefore, the Government has to assume responsibility for providing such services. 9. Defence Government has to set up public enterprises for issue of defence equipment. Supply of such equipment cannot be entrusted for private sector due to the need for utmost secrecy. 10. Labour upbeat Public enterprises serve as model employers.They ensur e welfare and social security of employees. Many public enterprises have genuine townships, schools, college and hospitals for their workers. Role and Rationale of Public Enterprises The public sector has been playing a vital role in the economic development of the country. In fact the public sector has come to shack such an important place in our economy that on its effective performance depends largely the achievement of the countrys economic and social goals. Public sector is considered a powerful engine of economic development and an important instrument of self-reliance.The main contributions of public enterprises to the countrys economy may be described as follows 1. Filling of gaps At the time of independence, there existed serious gaps in the industrial structure of the country, particularly in the field of heavy industries. raw material and key industries require huge capital investment, involve considerable risk and suffer from long gestation periods. Private sector con cerns do not come forward to establish such industries. Public sector has helped to fill up these gaps. The basic infrastructure required for rapid industrialisation has been built up, through the production of strategic capital goods.The public sector has considerably widened the industrial base of the country and speeded up the pace of industrialisation. 2. Employment Public sector has created millions of jobs to tackle the unemployment problem in the country. Public sector accounts for about two-third of the total employment in the organised industrial sector in India. By taking over numerous sick units, the public sector has protected the employment of millions. Public sector has also contributed a lot towards the improvement of working and living conditions of workers by constituent as a model employer. 3. Balanced regional developmentPrivate industries tend to concentrate in certain regions while other regions remain backward. Public sector undertakings have located their pl ants in backward and untraded parts of the country. These areas lacked basic industrial and civic facilities like electricity, water supply, township and manpower. Public enterprises have developed these facilities thereby bringing about complete transformation in the social-economic life of the people in these regions. Steel plants of Bhilai, Rourkela and Durgapur fertilizer factory at Sindri, machine slit plants in Rajasthan, precision instruments plants in Kerala and Rajasthan, etc. are a few ex adenineles of the development of backward regions by the public sector. 4. Optimum utilisation of resources Public enterprises influence fracture utilisation of scarce resources of the country. They are big in size and able to bonk the benefits of large scale operations. They help to eliminate uneconomic achievement and ensure full use of installed capacity. Optimum utilisation of resources results in better and cheaper production. 5. Mobilisation of surplus The profits earned by pu blic enterprises are reinvested for deoxyadenosine monophosphatelification and diversification. Moreover, public sector concerns like banks and financial nstitutions mobilise scattered public savings thereby helping the process of capital formation in the country. Public enterprises earn considerable foreign exchange through exports. 6. Self reliance Public enterprises have reduced considerably the need for imports by producing new and better products within the country. These enterprises are also earning considerable amount of foreign exchange through exports. 7. Socialistic pattern of society Public sector is an instrument for realising social objectives. Public enterprises help to check concentration of wealth and private monopolies.These enterprises can serve as powerful means of economic and social change. 8. Public welfare Public enterprises help in the establishment of a welfare state in the country. These enterprises supply essential commodities at cheaper rates. A proper balance between demand and supply is created to protect consumers against exploitation by profit hungry businessmen. Public enterprises also protect and promote the interests of workers. Criticism of Public Enterprises Arguments against Public Enterprises Public enterprises are opposed on account of weaknesses in their organisation and working.These enterprises generally suffer from the following problems 1. Delay in completion Often a actually long time is taken in the establishment and completion of public enterprises. Delay in completion leads to increase in the cost of establishment and benefits extracted from them are delayed. 2. Faulty evaluation Public enterprises are in some cases set upon political considerations. There is no proper evaluation of demand and supply and expected costs and benefits. There are no clear cut objectives and guidelines. In the absence of proper project planning there is under- utilisation of capacity and wastage of national resources. . Heavy over head costs Public enterprises often spend huge amounts on providing housing and other amenities to employees. Though such investment is reusable for employees but it takes away a large part of capital and the project suffers from financial difficulties. 4. Poor returns Majority of the public enterprises in India are incurring loss. In some of them the profits earned do not yield a reasonable return on huge investment. Lack of effective financial controls, wasteful expenditure and dogmatic pricing policy result in losses 5. Inefficient managementDue to excessive centralisation of authority and lack of demand public enterprises are managed inefficiently. High level provides are often occupied by persons lacking necessary expertise but enjoying political support. 6. Political interposition There is frequent interference from politicians and civil servants in the working of public enterprises. Such interference leaves little scope for initiative and freedom of action. Public enterpr ises enjoy little autonomy and flexibility of operations. 7. Labour problems In the absence of proper manpower planning public enterprises suffer from over-staffing.Jobs are created to fulfil employment goals of the Government. countenance of job in these enterprises encourages trade unions to be militant in pursuing their aims. Growth of Public Enterprises in India At the time of independence, public sector in India was confined mainly to railways, communications, defence production and public utility services. Since then the growth of public enterprises has been very rapid. Now public sector consists of public utilities (e. g. , railways, post and telegraph, etc), manufacturing concerns (e. g. , BHEL, SAIL, etc. ), trading organisations (e. g. STC, MMTC, etc. ), service organisations (e. g. , NIDC, RITES, etc. ). SAIL, a Maharatna Company of Govt. of India, is the worlds leading and Indias largest steel producer with an annual swage of around Rs. 50,348 crore (FY11-12). It operat es and owns 5 integrated steel plants at Rourkela, Bhilai, Durgapur, Bokaro and Burnpur and 3 special steel plants at Salem, Durgapur and Bhadravati. As part of its global ambition the Company is implementing a massive expansion plan involving project work of building/adding new facilites with emphasis on state of the art green technology.List of Maharatna, Navratna and Miniratna CPSEs As per obtainable information (as on February, 2013) Maharatna CPSEs Bharat Heavy Electricals special Coal India modified GAIL (India) curb Indian Oil potty peculiar(a) NTPC hold Oil & group A indispensable Gas Corporation Limited Steel billet of India Limited Navratna CPSEs Bharat Electronics Limited Bharat Petroleum Corporation Limited Hindustan Aeronautics Limited Hindustan Petroleum Corporation Limited Mahanagar Telephone Nigam Limited National Aluminium Company Limited NMDC Limited Neyveli Lignite Corporation Limited Oil India LimitedPower Finance Corporation Limited Power Grid Corporati on of India Limited Rashtriya Ispat Nigam Limited Rural Electrification Corporation Limited Shipping Corporation of India Limited Miniratna Category I CPSEs Airports Authority of India Antrix Corporation Limited Balmer Lawrie & Co. Limited Bharat Dynamics Limited BEML Limited Bharat Sanchar Nigam Limited Bridge & Roof Company (India) Limited Central computer memory Corporation Central Coalfields Limited Chennai Petroleum Corporation Limited Cochin Shipyard Limited Container Corporation of India Limited Dredging Corporation of India LimitedEngineers India Limited Ennore Port Limited Garden Reach Shipbuilders & Engineers Limited Goa Shipyard Limited Hindustan Copper Limited HLL Lifecare Limited Hindustan Newsprint Limited Hindustan Paper Corporation Limited Housing & Urban Development Corporation Limited India Tourism Development Corporation Limited Indian Railway Catering & Tourism Corporation Limited IRCON International Limited KIOCL Limited Mazagaon Dock Limited Ma hanadi Coalfields Limited Manganese Ore (India) Limited Mangalore Refinery & Petrochemical Limited Mishra Dhatu Nigam Limited MMTC Limited MSTC LimitedNational Fertilizers Limited National Seeds Corporation Limited NHPC Limited Northern Coalfields Limited Numaligarh Refinery Limited ONGC Videsh Limited Pawan Hans Helicopters Limited Projects & Development India Limited Railtel Corporation of India Limited Rashtriya Chemicals & Fertilizers Limited RITES Limited SJVN Limited Security Printing and Minting Corporation of India Limited South Eastern Coalfields Limited State Trading Corporation of India Limited Telecommunications Consultants India Limited THDC India Limited Western Coalfields Limited WAPCOS Limited Miniratna Category-II CPSEsBharat Pumps & Compressors Limited Broadcast Engineering Consultants (I) Limited Central Mine Planning & Design implant Limited Ed. CIL (India) Limited Engineering Projects (India) Limited FCI Aravali Gypsum & Minerals India Limited Ferro Scrap Nigam Limited HMT (International) Limited HSCC (India) Limited India Trade Promotion Organisation Indian Medicines & Pharmaceuticals Corporation Limited M E C O N Limited National Film Development Corporation Limited National teensy-weensy Industries Corporation Limited P E C Limited Rajasthan Electronics & Instruments Limited