Observe around you — you will find State Electricity Boards (SEBs), BSES and many public and private organisations supplying electricity in different states and union territories. There are private buses on roads alongside the government bus services and so on.
What do you think about this dual system of the co-existence of public and private sectors?
The dual system of co-existence of public and private sectors represents a balanced economic approach where both sectors contribute to development. We observe State Electricity Boards (SEBs) and BSES supplying electricity, and private buses operating alongside government bus services. This system allows the public sector to focus on infrastructure and employment generation while the private sector brings efficiency and competitiveness. Both sectors have expanded their wings to other countries, showing their global potential.
What are the merits and demerits of such a dual system? Discuss.
Merits of the dual system:
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Public sector enterprises were set up with the intention of providing infrastructure and direct employment to the public.
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They ensure that quality end-products reach the masses at a nominal cost and companies remain accountable to all stakeholders.
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Both sectors can compete effectively in the liberalised global environment, with companies like ONGC Videsh (public) and Tata Steel (private) having global operations.
Demerits of the dual system:
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Reforms in certain sectors can lead to adverse effects on vulnerable sections. For example, power sector reforms led to steep rise in power tariff and removal of subsidised rates.
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This affected workers in small industries, as seen in the Siricilla tragedy in Andhra Pradesh where powerloom workers suffered due to power cuts and tariff hikes, leading to loss of livelihood.
Explanation
The answer draws from the context which discusses how public enterprises were formed for self-reliance, infrastructure, and employment (Context 3), how both public and private companies have global operations (Box 3.2), and how power sector reforms negatively impacted small industry workers (Box 3.3). The merits focus on the social objectives of public sector and competitive advantages, while demerits highlight the unintended consequences of reforms on vulnerable populations.