{"id":315558,"date":"2025-11-24T12:19:50","date_gmt":"2025-11-24T12:19:50","guid":{"rendered":"https:\/\/peraltafinancing.com\/uncategorized\/objectives-and-advantages-of-public-corporations\/"},"modified":"2025-11-24T12:19:50","modified_gmt":"2025-11-24T12:19:50","slug":"objectives-and-advantages-of-public-corporations","status":"publish","type":"post","link":"https:\/\/fivemor.com\/?p=315558","title":{"rendered":"Objectives and Advantages of Public Corporations"},"content":{"rendered":"


\n<\/p>\n

\n

INTRODUCTION<\/h2>\n

All such industrial facilities that are owned, run, and controlled by either the federal, state, or municipal governments are considered to be part of the public sector. Public undertakings or State-controlled businesses can be traced back to the time of the Chola monarchs, who built roads, dams, temples, and other infrastructure before the 12th century. These public sector organizations represented a free market economy, which the colonial government opposed. As a result, during colonial administration, the public sector was only allowed to operate in the areas of railways, post, and telegraph. But, since India\u2019s independence in 1947, there has been a noticeable surge in the expansion of State-owned firms. Designed to define the role of public companies in the nation, the Industrial Policy Resolutions of 1948 and 1956 stressed on the need for State control in vital and strategic industries like steel, mining, petroleum, shipping, etc. And today, these government enterprises are rapidly supplying the public with better utilities in a structured manner and in bigger numbers.<\/p>\n

The paper was thus written with an aim to discuss further the subject and note down the objectives and advantages of government undertakings of the enterprises.<\/p>\n

WHAT IS A PUBLIC CORPORATION?<\/h2>\n

In Dartmouth College v. Woodward, <\/em>John Marshall stated,<\/p>\n

\u201cA corporation is an artificial being, invisible, intangible, and existing only in the contemplation of the law. Being the mere creature of the law, it possesses only those properties which the Charter of its creation confers on it, either expressly, or as incidental to its very existence. Those are such as are supposed best calculated to effect the object for which it was created. Among the most important are immortality, and, if the expression be allowed, individuality; properties by which a perpetual succession of many persons are considered the same, and may act as a single individual.\u201d<\/em><\/p>\n

A public corporation is an artificial entity created by law that may also be referred to as a statutory corporation or body. It is a body constituted by an Act or State law that has the authority to act on its own but is nevertheless subject to the regulation of various regulatory agencies. The Statute outlines the goals, authority, and responsibilities of the public corporation. It exists on its own, separate from the government, and is capable of owning legally, making contracts, and filing lawsuits in its own name. They are financially independent and able to retain and use its earnings for its business, and it creates its own budget. However, the government or organizations under its control furnish the capital for a public firm. But a lot of public firms have recently started to raise money on the stock market.<\/p>\n

Public corporations in India include Life Insurance Corporation of India, Indian Airlines, Air India International, Oil and Natural Gas Commission, among others.<\/p>\n

OBJECTIVES OF PUBLIC CORPORATIONS<\/h2>\n

The public sector has been essential to the growth of the nation\u2019s economy. It has significantly broadened the nation\u2019s heavy industry and sped up industrialization. In fact, the public sector now plays such a significant role in our economy that the accomplishment of the nation\u2019s social and economic objectives has a significant impact on how well it performs.<\/p>\n

The main objectives of public corporations are as follow-<\/p>\n

1. DEVELOPMENT OF THE ECONOMY<\/h3>\n

As soon as India gained independence the government announced that India will have a socialist structure. The economy was meant to undergo a transformation in the public sector that would enable socialism to take hold. The public sector must increase both absolutely and substantially to the private sector if development is to progress at the desired rate and successfully contribute to the achievement of the larger socio-economic goals.<\/p>\n

Public businesses were established to increase economic growth in a planned manner. These businesses have built a strong industrial foundation that will enable the nation to quickly industrialize. They are supposed to provide the infrastructure needed to support a developing economy with a balanced and diverse structure.<\/p>\n

2. SELF- SUSTENANCE<\/h3>\n

Public enterprises also seek to encourage sovereignty in key areas of the country\u2019s economy. They have significantly decreased the need for imports by creating new and improved products domestically. These businesses are also exporting goods and services that generate a sizable quantity of foreign currency. Public firms in transportation, communication, energy, petrochemical, and other important and fundamental industries have been established for this reason.<\/p>\n

3. DEVELOPMENT OF UNDERDEVELOPED AREAS<\/h3>\n

In order to address regional development disparities, a number of state firms were founded in underdeveloped areas. Both social and strategic considerations call for the balanced development of the nation\u2019s varied regions.<\/p>\n

Private industries frequently concentrate in some places while lagging behind in others. Public sector organizations have set up businesses in underdeveloped, neglected regions of the nation. Basic industrial and governmental resources including electricity, water access, townships, and labor were lacking in these places. These facilities were developed by public corporations, completely altering the social and economic conditions of the local populace.<\/p>\n

4. GENERATION OF JOBS<\/h3>\n

In India, unemployment has gotten out of hand. Public businesses aim to give millions of people gainful jobs.\u00a0 With the enactment of Sick Industrial Companies\u00a0(SICA), 1958 several ill groups in the private sector have been nationalized in order to preserve jobs.<\/p>\n

Millions of jobs have been generated by the public sector to address the nation\u2019s unemployment issue. About two-thirds of all jobs in India\u2019s organized industrial sector are in this sector. By acting as a role model employer, the public sector has made a significant contribution to the improvement of workers\u2019 living and working conditions.<\/p>\n

5. SOCIAL WELFARE<\/h3>\n

Public businesses support the development of a welfare state in the nation. These businesses offer discounted prices on necessities. To guard customers from being taken advantage of by businesspeople who are only interested in making a profit, demand and supply must be properly balanced. Additionally, public businesses safeguard and advance the interests of employees.<\/p>\n

Public businesses serve as an excellent model for employers. Employee welfare and social security are ensured by them. For the benefit of its employees, numerous public corporations have built cities, schools, colleges, and hospitals.<\/p>\n

ADVANTAGES OF PUBLIC CORPORATIONS<\/h2>\n

1. BOLD AND EFFICIENT MANAGEMENT RESULTING FROM AUTONOMY<\/h3>\n

Due to its independence from governmental oversight, a public firm enjoys internal operational autonomy. As a result, it can function like a business. Management can make ambitious decisions that include experimentation in its areas of expertise and take advantage of commercial circumstances.<\/p>\n

2. LEGISLATIVE JURISDICTION<\/h3>\n

Public corporations are legitimately created legal entities\u00a0by the legislative branch of either the Indian federal or state government. As a result, the relevant legislative committee is reviewing these corporations\u2019 legal activities. Additionally, the Press keeps a close eye on how a public firm operates. This prevents the management of the public firm from engaging in unhealthy behaviors.<\/p>\n

3. QUALIFIED AND MOTIVATED WORKFORCE<\/h3>\n

While public firms are free to hire employees and set rules for their behavior, they are nonetheless governed by standard employment laws and procedures. Public corporations give their employees enticing working circumstances. As a result, it can draw in qualified employees. Industrial relations issues are not as severe thanks to a skilled and happy workforce. The employees are driven to put in a lot of effort for the company.<\/p>\n

4. CUSTOMIZED LEGISLATION<\/h3>\n

The statute that establishes these corporations can be modified to meet particular needs. An organization can work most effectively toward the accomplishment of its goals by implementing these modifications.<\/p>\n

5. PRICING STRATEGY<\/h3>\n

Public enterprises implement pricing policies that are typically based on cost-benefit analysis as opposed to an undiluted capitalist profit-centered strategy because they are formed from the beginning for the overriding public interest. As a result, the public is content with the goods and services that public enterprises provide.<\/p>\n

CONCLUSION<\/h2>\n

The Central or State governments of India\u2019s legislative edict resulted in public corporations.\u00a0Constructing public corporations is mostly done to encourage economic development through independent organizations. With that goal in mind, these corporations have been given extremely broad powers, and no authority is interfering with their use of those powers. However, it is also essential that these entities have some level of oversight so that the authority granted to them is not arbitrarily utilized or misused, and so that it does not turn into the \u201cheadless fourth organ\u201d of the government.<\/p>\n

Author:<\/b> Tanya Tanu,
University of Petroleum and Energy Studies, fourth year <\/p>\n<\/p><\/div>\n\n","protected":false},"excerpt":{"rendered":"

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