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PRIVATE, PUBLIC AND GLOBAL ENTERPRISES 67 The public sector is able to set public sector from 17 to 8 large industries which requires heavy (and then to 3): In the 1956 investment and thus the income and resolution on Industrial policy, benefits that accrue are shared by 17 industries were reserved for a large of number of employees and the public sector. In 1991, only workers. This prevents concentration 8 industries were reserved for of wealth and economic power in the the public sector, they were private sector. restricted to atomic energy, arms (v) Import substitution: During the and communication, mining, second and third Five Year Plan period, and railways. In 2001, only India was aiming to be self-reliant three industries were reserved in many spheres. Obtaining foreign exclusively for the public sector. exchange was also a problem and it These are atomic energy, arms wasdifficulttoimportheavymachinery and rail transport. This meant required for a strong industrial base. that the private sector could enter At that time, public sector companies all areas (except the three) and involved in heavy engineering which the public sector would have to would help in import substitution were compete with them. established. Simultaneously, several The public sector has played a public sector companies like STC and vital role in the development of the MMTC have played an important role economy. However, the private sector in expanding exports of the country. is also quite capable of contributing (vi)  Government policy towards substantially to the nation building the public sector since 1991: The process. Therefore, both the public Government of India had introduced sector and the private sector need to four major reforms in the public sectorbe viewed as mutually complementary in its new industrial policy in 1991. parts of the national sector. Private The main elements of the Government sector units also have to assume policy are as follows: greater public responsibilities. • Restructure and revive potentiallySimultaneously, the public sector viable PSUs needs to focus on achieving more in a • Close down PSUs, which cannot highly competitive market. (b) Disinvestment of shares of be revived • Bring down governments equity in a select set of public sector all non-strategic PSUs to 26 per enterprises: Disinvestment cent or lower, if necessary; and involves the sale of the equity • Fully protect the interest of shares to the private sector and workers. the public. The objective was to (a) Reduction in the number of raise resources and encourage industries reserved for the wider participation of the general Reprint 2026-27