public enterprises are the best form of organisation for balancing region

Dear Student,
As we know, that the prime objective of private sector industries is to earn profits. The sole objective of profit making often prevents these private sector enterprises from setting up industries in the rural and  backward areas. On the other hand, the public sector are not driven by the sole motive of earning profits. Besides profits, it is the welfare motive that normally drives the public sector. Thus, the public sector enterprises are a better form of organisation to balance regional development

The following are the ways in which the Public sector enterprise maintain regional balance in the country.

(a) Setting up steel industries in rural areas: The Government of India establishes steel plants in rural areas with the objective of facilitating economic development and growth of rural and backward areas.

(b) Creating employment opportunities: The steels plants and many other enterprises in rural areas provided the rural people with employment opportunities, helping them to earn a higher income and enjoy a better standard of living.

(c) Facilitating development through linkages: The setting up of the industries contributed to the development of various forward and backward linkages, besides providing employment opportunities. These linkages encouraged the agricultural sector, which in turn spurred the development of ancillary industries (i.e., related industries).

(d) Ensuring infrastructure development: The establishment of industries in rural and backward areas necessitated infrastructure development, including better roads, railways and bridges. The infrastructure made the backward areas well connected with the rest of the country, facilitating the growth and development of these areas.

Thus, we can say that public sector enterprises are best suited for balanced regional development.

  • 5

This is beacause they are cheaper than the privately owned enterprises. Their main aim is not profit earning but it is welfare of the region, that is developement of the region.

  • 1
What are you looking for?