Q.Discuss the rationale for giving dominant role to public sector.

Dear student,

The rationale behind giving dominant role to public sector was as under:

1. The infrastructure projects need heavy investment base and long period, which discourage private sector and encouraged public sector to come into play.

2. To bring balanced regional growth public sector had set up many units in rural and backward area, in order to provide employment and encourage development in these areas.

3. Large scale industries like oil and petroleum bring economies of scale. These industries need heavy investment for its set up which discouraged private sector to initiate these industries. Hence, public industries came into play.

4. Public sector ensure that there is no concentration of power (in the form of monopoly) in hands of private units.

5. To achieve self sufficiency, public sector units set up heavy industries and produced heavy machinery and engineering products to in order to substitute imports and promote exports.


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