Essay on The Role of Public Sector Undertakings in Our National Economy Complete Essay for Class 10, Class 12 and Graduation and other classes.
Public Sector Undertakings are of recent origin but are deep-rooted and are today playing a vital role in our economy. With the increase in the volume of work and tendency for nationalization, need and necessity of public sector enterprises has considerably increased. It is felt that through the public sector undertakings, effective government control can be run and managed for the welfare of the community as a whole.
There cannot be two opinions about the need for establishment of public sector enterprises in the developing countries like India. The private enterprises are always in search of profit and this motive leads them to fields where the returns are high and certain. In the developing countries, this tendency has many drawbacks. First, as more and more capital is injected into the same type of business, competition increases and with it costs go up. With increasing costs, prices also increase and markets are hit. Secondly, development in the underdeveloped countries is usually lop-sided and is restricted to certain fields of production. Consequently, people are seldom self-sufficient in respect of their needs and remain virtually slaves to outside or foreign trades. Before the introduction of planning in India, Indian businessmen put their money mainly in traditional business, like jute and cotton or iron and steel. Jute and cotton were preferred because of their greater demand in foreign markets and iron and steel because of great domestic potentialities.
The Government can float an undertaking on the principle of minimum profits or on a no-profit no-loss basis. These activities fall beyond the purview of private business enterprises and hence government undertakings in industry are desirable or rather necessary in a developing country. In other words, the economy of such a country needs to be duly controlled and unless and until capital acquires free movement and diverse channels to cater to different needs and improve the standards of living, a free economy in a country would not work well.
There are, however, many loopholes in the public enterprises. Since public undertakings have a tendency to be manned by civil servants, particularly drawn from Government departments, a sense of ease and irresponsibility arising out of inefficiency and lack of technical knowledge and experience, becomes associated with public undertakings. These factors cause wastage, not to speak of nepotism and corruption that usually creep up into the administration of a public undertaking. Consequently, the administrative efficiency falls to low levels. A private enterprise has to work efficiently in order to stand against the prevailing competition as well as to create and maintain goodwill. The business house has no room for a lazy bone. Every employee has to show his work and prove his worth daily to keep the job. It is not so in government organizations. There is no personal interest for a Manager to keep a vigilant watch over the workers and things being done in a leisurely manner. The top posts in these undertakings become the exclusive preserve of the children, friends and friends of friends of the political high-ups, who for obvious reasons treat these undertakings as their private estates.
These difficulties should not, however, dishearten a government or people in setting up the public enterprises. Without the support of public enterprises, the development of basic industries is not possible. It is only the government which has the power to raise funds, the like of which can never be raised by a private businessman without upsetting the basic economic democracy or without causing undue concentration of wealth. The existence of public sector is also important for coordination in various economic activities and for creating a spirit of patriotism and loyalty among citizens, workers and managers with a view to raising general standards. In a mixed economy like that of India, public enterprises should be a part and parcel of the greater plans.
For the more efficient working of public enterprises, the attitude of the Government towards public enterprises is very important. Much more important is the role of civil servants working in Public Sector Undertakings and controlling these undertakings in the Government departments. Here, unfortunately, we have rigid rules and regulations. For almost everything, the enterprises, though we call them autonomous, are required to obtain the approval of the Government. It is the duty of the bureaucrats to apply the rules and regulations. If they do not, audit authorities are there to take them to task. Therefore, bureaucracy is inherent in rules and regulations. But all these rules and regulations are applied indiscriminately to operation of an economic enterprise where almost every situation is different. In the case of public enterprises, the civil servants must be prepared to take the bold steps and support the enterprise in the case of difficulty. Thus the attitude of ministers and outlook of the civil servants in the secretariat towards public enterprises has got to be different from the one prevailing at present.
If the attitude of management and the bureaucrats is reoriented, our public sector enterprises will not only become more efficient but will also become much more profitable. A human being wants a sense of fulfillment. He wants a sense of appreciation, a sense of involvement and a sense of pride. These are the things which he can get much more in a public enterprise. We have only to create a proper atmosphere for the better functioning of the public enterprises by generating the necessary psychological changes in the thinking of different personnel concerned.
