For MA Students in Political Science

1. Private Sector’s Role &
Regulation
Hakeem Jan Muffaker, PhD Scholar, Kerala University &
Former Senior Civil Servant, Afghanistan
11 September, 2021

2. 1. Introduction
2. Role of Private Sector
3. Regulatory Practices in India

3. Private Sector
■ All those units or corporations that is owned, controlled &
managed by private individuals and enterprises is know as PS
■ The most private sector organization are run with the
intention of making profit.
■ The private companies are broadly classified into Three
categories, like small scale, Medium & Large enterprises
■ The capital are arranged by the owners.
Example: Cos in below Sectors: Service, Manufacturing,
Agriculture

6. 2. Private Sector Roles:
■ Most important sector & has a bigger role to play
■ Provide Efficiency, Flexibility, driven by competition
■ Helpful for Dev (housing, electricity, roads, airports, public
transport, water, sanitation, waste mgt, hospitals, schools
■ Employment around 90% in the developing world
■ Health, Telecom and Banking Sectors
■ Contribution to Agriculture
■ Contribution to industry, delivers critical goods & services
■ To detach from & reduce political interference
■ To increase the standard of living of the people
■ Strategic Military & security Services: Private Military Co

7. Importance in Economic Dev: 5th$, 90%GDP, ¾ NI based on PS

8. 1. Financial reforms lead to more
investment of foreign companies in India
2. Usage of more advanced technology
3. People are getting quality products services
4. Increasing the demand of people by
introduction of new services & products

9. GROWTH OF PRIVATE SECTOR IN INDIA
‣ Increase in number of Private Sector Cos
‣ increase in Employment
‣ Moto: Make for, Made in India, for the World
Year No. of Private sector Companies
1957 19,283
2010 8,19,580
2016
10,87,256

10. ROEL OF GOV IN IMPROVING PS
‣Financial assistance: SIDBI,NABARD,IFCI,EXIM Bank etc
‣ Increase in Areas of private sector: reserved industries under
public sector have been reduced from 17 to 2
‣ Liberal Licensing: procedure is simplified
‣ Liberal import of goods and technology
‣ Liberal flow of foreign funds: 100% foreign equity partpn
‣ Support to small scale industries: tax subsidies, technical
assistance, concessional loans and reserved areas
‣ Protection from foreign Competition: Heavy import duties
‣ Infrastructure facility: Banking ,insurance,transport,Ware housg

11. 3.Regulatory Framework in India
Defining Regulation:
Regulation refers to “ Controlling human or societal
behaviour by rules or regulations or alternatively order
issued by an executive authority or regulatory agency of a
government having the force of law”

13. Rational for Regulation
1. To prevent market failures
2. To check anti competitive practices
3. To promote public Interest

18.  Independent Regulatory Agencies: Controlling
business through law-backed specialized agency.
‣ Independent Regulatory Institutions have been set up in
various Sectors in India after the introduction of Economic
Reforms in 1991.

19. List of Major Regulations & Specialized Agencies

22. Conclusion
▸ The private sector was started long back but it was not because policy
makers found conclusive evidence for its superiority
▸ The public sector in spite of its defects is a driving force for sector in
India, because it takes initiative to develop infrastructure.
▸ Public sector provides foundation to the private sector.
▸ Greater competition lead to more improvement and more innovative
products.
▸ The private and public sector have to work together to develop the
economic conditions both are equally responsible for it.