GROWTH AND PERFORMANCE OF PRIVATE SECTOR IN INDIAN ECONOMY AFTER LIBERALIZATION

Abstract

Private sector enterprises are owned and managed by the private sector. These private sector enterprises are mostly characterized by certain common characteristics like private initiative, profit motive and ownership and management in private hands. In 18th and 19th century, most of the countries of the world adopted the policy of laissez faire where the Governments followed a policy of non-interference in economic activity by the State. In a developing country like India, with the continuous expansion of the public sector, the productive areas open for the private sector has gradually squeezed. It is only during the post-1991 period of economic liberalisation, more and more areas are being made open for the private sector and the industrial activities in this sector gained its momentum both through participation of domestic and foreign, private companies. In India, the distinction between the private sector and the public sector gained its importance, particularly after the introduction of Industrial Policy Resolutions 1948 and 1956, paving the way for the adoption of mixed economy in India.