Profits of Public Undertakings

In a developing economy, where the scope of the public sector has been progressively expanding in the industrial. financial and commercial spheres, it is desirable that a large amount of resources should be generated and billion,.ed in this sector  of the price policy of the public undertaking should give place to a policy of reasonable profits  the output produced and sold. Similarly, state trading organizations conducting any domestic and lot foreign trade should suitably adjust their price policy to mobilize the resources in the form of trading profits.

In advanced countries, public undertakings contribute a sizable proportion of resources for economic development. In Soviet Russia, of course, 90 per cent of the public revenue is derived from the public undertakings (private undertakings there are practically non-existent). Even in the U.K., nationalization of some industries has expanded this source of development. But in some countries of South.

Eastern Asia, this source of revenue has become very important because of state ownership of certain’ industries and state trading in ‘~one important commodities. q:., rice trading in Myanmar (Burma l. In India, there is a very large number of public undertakings operating at present. After the initial period of pioneering losses some of them are now yielding handsome dividends. This is an expanding source of revenue available for economic development.The Fifth Five-Year Plan estimated that the Central  and State undertakings would contribute Rs. 6,000 crores to its total outlay.