Public enterprise

1. UNIVERSITY OF MYSORE
POST-GRADUATION SATELLITE CENTRE, CHAMARAJANAGAR.
BUSINESS ENVIRONMENT
ASSIGNMENT ON
PUBLIC ENTERPRISES
By,
Abhishek E

2. PUBLIC ENTERPRISES

3. CONTENTS
 Introduction of Public Enterprise
 Meaning of Public Enterprise
 Characteristics of Public Enterprise
 Advantages of Public Enterprise
 Disadvantages of Public Enterprise
 Government Role

4. INTRODUCTION
 Public Enterprise is Owned by Government
and Managed by Government.
 Its objective is to maximize social welfare and
ensure balanced economic development.
 Capital is raised from Government and
sometimes through public issues.
 Operates in basic and public utility sectors.

5. MEANING
 According to N. N. Malaya, "Public enterprises are autonomous or semi-
autonomous corporations and companies established, owned and
controlled by the state and engaged in industrial and commercial
undertakings".
 A Pubic Enterprise may be defined as any commercial or industrial
undertaking owned and managed by the government with a view to
maximize social welfare and uphold the public interest.
 The term public enterprise denotes a form of business organization
owned and managed by the state government or any other public
authority. So it is an undertaking owned and controlled by the local or
state or central government. The whole or most of the investment is made
by the government.
 Public Enterprises consist of nationalized private sector enterprises
such as banks, Life Insurance Corporation of India (LIC), Indian Railways
and the new enterprises set up by the government such as Hindustan
Machine Tools (HMT), Gas Authority of India (GAIL), State Trading
Corporation (STC), Indian Oil Corporation (IOC), Bharath Sanchar Nigam
Ltd (BSNL) etc.

6. CHARACTERISTICS OF PUBLIC
ENTERPRISES
 Government Ownership and Management
 Financed from Government Funds
 Public Welfare
 Public Utility Services
 Public Accountability
 Excessive Formalities

7. ADVANTAGES OF PUBLIC
ENTERPRISES
 Charges low prices.
 Provide essential facilities like education, health, free or at
reduced prices.
 Ensures efficient control of industry.
 Expert administrative services.
 Money can be made available for R&D.
 Private monopoly which would cause high prices is
avoided.
 Foreign denominations of the economy are avoided.

8. DISADVANTAGES OF PUBLIC ENTERPRISES
 Government must bear losses or this could lead to higher
taxation.
 Consumers’ choice is restricted to the state if the business is a
monopoly.
 Regulations may be passed to curb the progress of private
business.
 Lack of competition may lead to inefficiency and higher prices.
 Government interference.
 Don’t care attitude.
 Political pressure.
 Corruption and embezzlement of funds.
 Foreign investment may be discouraged due to fear of
nationalization.

9. GOVERNMENTGOVERNMENT ROLEROLE
 Driving public sector reform to increase efficiency,
flexibility and integrity.
 Leading and assisting the public sector to build a
skilled, ethical, diverse and knowledgeable
workforce.
 Broadening and enhancing our evaluation and
reporting of public sector management and
administration.
 Provide essential facilities at reduced prices.

10. THANK YOU