Public Enterprises are defined as the statutory companies or business or entity which produces goods and services to satisfy the basic needs of the people and for the welfare of people operated partly or fully by the government. In simple meaning public enterprise is an enterprise which is controlled by the government mainly through its ownership. More concisely public enterprises is an incorporated or large unincorporated enterprise in which public authorities hold a majority of the shares and/or can exercise control over management decisions. Public enterprises are also called as 'State Owned Enterprises (SOE)'. Government operates these enterprises mainly in industrial, service, infrastructure and public utilities sector.
Importance of Public enterprises lies on the matter when private sector failed to provide social welfare to the people because of the high risk of establishment and lack of high capital. Private sector does not want to establish enterprises which may have high risk. Similarly private sector does not invest in the areas where chance of profit maximization is low.
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