1 Discuss five importances of public sector enterprises.
Answers
Answer:
The importance of public enterprises is become clear from the following points
1. Most developing countries have five years development plans for economic development. Public enterprises are given specific roles and targets in such plans.
2.Infrastructure consists of transport, communication, power, irrigation, drinking water and buildings.
3.Iron and steel, electricity, cement, fertilizer, petroleum and telecommunication are examples of basic and heavy industries. They are essential for industrialization of the country. Private sector lacks resources and interest to invest in such industries. Public enterprises are important for the establishment of basic and heavy industries. Defense production is generally done by public enterprises.
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The public enterprises came into existence as a result of the expanding scope of public administration. The advent of the concept of welfare state after the Second World War and the increasing developmental initiative undertaken by Government across the world, the system of public enterprises was developed. The government sells goods and services to the common people through the means of a state owned enterprise system which incorporates the characteristics of both public and private enterprises. For e.g. the metro train facility for commuting in big cities, developed, managed and run by the government.