Growing Public Sector

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Growing Public Sector

Another important feature of-a planned economy is the vital role played by the public sector and its growing importance. Private sector cannot be expected to sink capital in enterprises in which the return is long-delayed and is uncertain. It will avoid pioneering tasks which are naturally hazardous. Nor can the private sector be expected to build up a modem steel plant. In certain lines of industry. the market may not be sufficient to attract private capital. In under-developed countries. the entrepreneurs prefer to invest in commerce to investing in industry. Thus. many industries of vital national importance remain neglected. Heavy industries are beyond the means of private entrepreneurs but they ate indispensable for building up a self reliant and self-generating economy

The State as the custodian of national interests must step in where private enterprise is shy and is found wanting. The public sector really provides the essential framework for spreading -out the planned economic activity. In India, quite a large number of important industries have been exclusively reserved for the public sector threader the Industrial Policy Resolutions of 1948 and (956. The public enterprises not only fill up the gap(in industrial structure but also provide the foundation and pave the way for further economic development. In all planned economies, the public sector is steadily expanding and assuming greater and greater importance.

Other Features. Better balance, more even distribution of economic power greater economic stability, higher level of employment, fuller localisation or resources, greater security for the workers, elimination of recurring business cycles are some other features of a planned economy.

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