Public Sector and Private Sector:
- Public sector is the sector which is owned, controlled and managed by the government. Activities in the government sector are guided by the motive of social welfare and not to earn profit. Railways or post office is an example of the public sector.
- In Private sector ownership of production, units is in the hands of private individuals. Activities in the private sector are mainly guided by the motive to earn profit. Example: TISCO and RIL .
- There are several things needed by the society as a whole but which the private sector will not provide at a reasonable cost. Even if they do provide these things they would charge a high rate for their use. Examples are construction of roads, bridges, railways, harbours, generating electricity, providing irrigation through dams etc.
- Some activities require support of government. The private sector may not continue their production or business unless government encourages it.
- By Bearing part of the cost of producing and supplying electricity which small scales industries can afford, it prevents them from shutting down.
- Government must spend on large number of activities which are its prime responsibilities example: health and education.
- Government should also pay heed various aspects of human development such as: availability of safe drinking water, housing facilities for the poor and food and nutrition.
