Poor Performance of Public Sector Enterprises (9 Causes)! Cause # 1. Low Capacity Utilisation: Most public sector enterprises set up in India during the plan period could not utilise their entire capacity which was created at high cost. In 1999-00, nearly 20% of such enterprises succeeded in utilising 55 to 75% of their capacity and another 25% operated below 50% [...]
Disinvestment and Privatisation of Public Sector Enterprises in India! Meaning of Disinvestment: An important aspect of present industrial policy of the Government is that it should not operate commercial enterprises. With that end in view the Government has decided to disinvest the public enterprises. The Government can sell its enterprises completely to the private sector or disinvest a part of [...]
Here we detail about the nine causes of poor performance of public enterprises in India. 1. Lack of Importance to Profit Motive: In the working of public enterprises profitability criteria was not given proper place. Some of the persons and economists associated with our Planning Commission who formulated policies on public sector enterprises as well as those who were entrusted [...]