Business Studies for Class 11 Chapter 3 Public, Private, and Global Enterprise

Learn CBSE Business Studies Index Terms for Class 11, Chapter 3 Including Definitions and Meanings

1. Public Sector – The public sector consists of businesses that are owned and controlled by the government of a country. The ownership and control of the central or state governments in these organisations are either complete or partial. But it still holds a majority stake and makes every single decision regarding running the entity. These organisations include government agencies, state-owned enterprises, municipalities, local government authorities, and other public service institutions.

Some of them can be non-profit organisations, while others participate in commercial activities as well. It generally focuses on providing goods and services to the general public at relatively cheaper rates than private companies. Its main aim is to ensure the welfare of the general public within a country.

2. Private Sector – The private sector enterprises are owned, controlled, and managed either by individuals or business entities. It can be small-scale, medium-scale, or even large-scale organisations. They get formed to earn a profit from their business operations and can raise funding from individuals, groups, and the general public.

The different entities within the private sector include sole proprietorship, partnership, cooperative societies, companies, and multinational corporations. They also focus on taking care of the needs of their customers to survive in the long run. Ever since the introduction of the New Economic Policy in 1991 by the Government of India, almost every industry in the country has opened up to the private sector. It has led to a phenomenal increase in the size of the Indian economy and its growth rates.

3. Public Enterprise – The sector or enterprises are the businesses that are owned and controlled by the government. Here, a company can be partially or completely managed by the central or state government and participate in many economic activities of a nation.

4. Private Enterprise – The private sector or enterprise is the businesses that are owned by a private group or an individual. Different types of businesses under private enterprises are partnerships, sole proprietorships, cooperatives, and companies.

5. Statutory Corporation – Statutory corporations are defined as autonomous corporate bodies that are created by a special act of Parliament or state legislature having predefined functions, duties, powers, and immunities as defined by the act of the legislature.

Statutory corporations enjoy autonomy in the case of finance and are answerable to the particular legislature under which it was formed.

6. Departmental Undertaking – Departmental Undertakings are the common and more established form of establishing public enterprises. These enterprises are formed, operated, and part of the department of the ministry.

All government work and activities are accomplished through this department, and cannot be entitled as independent or autonomous entities.

All the employees working in the department are under the government; therefore, they are termed, government employees. However, the government undertakings are divided into state and central governments. A few examples of government undertakings are a railway, post office, etc.

7. Government Companies – A government company means any company in which not less than 51% of the paid-up capital is held by the central government or by any state government or partly by the central government and partly by one or more state governments. For example, the Steel Authority of India and State Trading Corporation.

8. Disinvestment – Disinvestment is defined as the action of a government aimed at selling or liquidating its shareholding in a public sector enterprise in order to get the government out of the business of production and increase its presence and performance in the provision of public goods and basic public services such as infrastructure, education, health, etc.

Funds from disinvestment would also help in reducing public debt and bring down the debt-to-GDP ratio while competitive public undertakings would be enabled to function effectively.

9. Public Accountability – An individual who is given the responsibility of holding, using, or disposing of public resources which do not belong to that particular individual must be answerable or accountable to the owner on how one utilises the resources. In the same manner, an elected government has the power to utilise the public funds and resources which are collected by them in the form of receipts, fees, and taxes and are accountable to the public.

10. Privatisation – Privatisation can suggest several things, including the migration of something from the public sector to the private sector. It is also used as a metonym for deregulation when a massively regulated private firm or industry becomes less organised. Government services and operations may also be privatised (denationalised). In these circumstances, private entities are tasked with the application of government plans or the execution of government assistance that had earlier been the vision of state-run companies. Some instances involve law enforcement, revenue collection, and prison management.

In other words, it means the transfer of ownership, management, and control of the public sector enterprises to the private sector.

11. Globalisation – The term globalisation refers to the integration of the economy of the nation with the world economy. It is a multifaceted aspect. It is a result of the collection of multiple strategies that are directed at transforming the world towards greater interdependence and integration.

It includes the creation of networks and pursuits transforming social, economical, and geographical barriers. Globalisation tries to build links in such a way that the events in India can be determined by the events happening distances away.

To put it in other words, globalisation is the method of interaction and union among people, corporations, and governments universally.

12. Global Enterprise – Global enterprises are firms that function across the globe, that is, in international trade. These enterprises are categorised based on their size, their products, technological advancements, marketing and strategy, and operational network around the world.

The central vision of a global enterprise company is to operate across many countries to earn international currencies. It has different books of accounts in several countries, which are merged at the end of the financial year according to their usage.

13. Joint Venture – A joint venture (JV) is a business course of action in which at least two parties consent to pool their assets to achieve a particular undertaking. This undertaking can be a new task or some other business movement. In a JV, all of the members are liable for benefits, misfortunes, and expenses related to it. Notwithstanding, the business has its own entity, separate from the members’ and other financial matters.

14. Public Sector Undertakings (PSUs) – State-owned corporations or enterprises in India are recognised as PSUs. The government introduces PSUs under its sign and standard for carrying out commercial work. Such state-owned companies are less apprehensive about profit-making and much more oriented on the nation-building directions and developing and expanding the nation’s economy.

The central or state government manages most of the company’s equity in PSUs that have 51% or more. The CAG (Comptroller and Auditor General ) of India monitors all PSUs.

15. Public-Private Partnership (PPP) – Public-Private Partnership (PPP) refers to the involvement of private enterprises in the form of management expertise and financial contribution to government projects for public benefits. A public partner may be a central government or a state government, or a local body. A private partner may be either an Indian private enterprise or two or more enterprises of foreign private enterprises. For example, a number of highway projects have been taken up under PPP.

In other words, a public-private partnership (PPP, 3P, or P3) is a cooperative arrangement between two or more public and private sectors, typically of a long-term nature.

We hope that the offered Business Studies Index Terms for Class 11 with respect to Chapter 3: Public, Private, and Global Enterprise, will help you.

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