The present paper focuses on investment in Central Public Sector Enterprises, Equity Holding by Central Government in PEs, shares of private and public sectors in plan outlay, growth of turnover/operating income, public sector enterprises exports and Indian exports, PBDIT, PBIT, net profit of Central Public Enterprises, etc. From the study it is observed that the number of enterprises generating internal resources increased from 145 in 1990-91 to 152 in 2003-04. The amount of internal resources generated increased from Rs. 11,296.19 cr in 1990-91 to Rs. 75,621.71 cr in 2003-04, a growth of 670 percent. The paper, after observing the trends in the internal investment, turnover, profit before tax, etc., concludes that the public sector enterprises have become strong and financially viable and are in a position to compete with international companies which have started investing in India after liberalization, globalization and privatization after 1990s.
For four decades after independence, India followed a development strategy
based on extensive government direction of the economy. This included broad
public ownership of commercial enterprise, a requirement for government
approval for new investment by large private companies, substantial protection
against imports, restrictions on exports, strict limitations on forging investment,
and a government policy framework that posed strong obstacles to the
development of capital markets. Most finance for investment projects was done
through banks and heavily administered by the government. India’s private sector
was probably the most controlled in the non-socialist world.
In June 1991, in the midst of severe fiscal and external imbalances,
which had generated double-digit inflation and put the country on the verge
of defaulting on its external debt obligations, a new government formed
under the Prime Ministership of P V Narasimha Rao undertook the major task of
stabilizing and liberalizing the economy. Since 1991, reform of the investment,
exchange rate, and trade regimes has ended four decades of state planning and
set in motion a quiet economic revolution. |
