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Discuss the expansion of public sector in terms of investment and increasing employment opportunities.

Discuss the expansion of public sector in terms of investment and increasing employment opportunities.


1 Answer

The investment in central public sector undertakings has grown substantially over the years. From 29 crores as on April 1st 1951 in five enterprises, the investment has gradually increased to Rs. 99,315 crores in 244 operational public enterprises as on March 31, 1990. This expansion of public sector has led many positive effects on economy in terms of output, employment, generation of resources, balanced regional development etc, on employment front there has been a considerable expansion. On March 31, 1989, 232 central public sector enterprise employed 22.93 lakh people which constitutes more than one-third of the total employment in the organized sector.

The public sector has become a model employer as, most of the enterprises have recognized their social responsibility in providing housing, educational, medical, recreational facilities to the employees, especially in cases where the projects are located in towns and villages which are inaccessible. Housing was turned into an emotional factor as it brings out the feeling of attachment among employees for their enterprises. Public sector has been one of the instruments in bringing about development of human resources.

The need for public sector arises to meet the undermentioned objectives:

  • To help the rapid industrial and economic growth of the country and development of necessary infrastructure for economic progress.
  • To earn return on investment and further generate resources for development.
  • To promote redistribution of income and wealth.
  • To generate employment opportunities.
  • To promote balanced regional development.
  • To assist in the development of small-scale and ancillary industries.
  • To promote import substitution, save and earn foreign exchange for the economy.

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November 14, 2019