Joint Sector And Cooperative Sector In Business

equity and thereby transform them into joint sector enterprises. JOINT SECTOR AND COOPERATIVE SECTOR IN BUSINESS  The government or public sector undertakings can directly acquire part of the equity in existing private enterprises and convert them into joint sector companies.  Existing public sector undertakings can sell a portion of their equity to private entrepreneurs or the general public and get transformed into joint sector entities. Joint Sector Introduction The joint sector refers to enterprises that are jointly owned and managed by the private sector and the government or public sector undertakings. It is a unique model that combines the managerial expertise and efficiencies of the private sector with the financial resources and social orientation of the public sector. The joint sector brings together the best of both worlds. Formation Enterprises of Joint Sector There are several ways in which joint sector enterprises may be established:    The central government and private entrepreneurs can jointly set up new enterprises from scratch. Sometimes the central government along with one or more state governments can also partner with private players to establish joint sector companies. State governments through their industrial development corporations can float new joint venture companies by taking equity stakes along with private partners. Public financial institutions like IDBI, ICICI etc. can convert part of their loans and debentures in existing private companies into Rationale behind the Joint Sector The main objectives and advantages sought to be achieved through the joint sector model are:  Curbing the concentration of economic power in the hands of large business houses by allowing joint ownership between state and private players.  Giving a social orientation and public accountability to the management of industries by having government participation in equity and the board.  Accelerating the pace of economic development by harnessing the combined resources of the state and the private sector.  Promoting the mixed economy model by combining the strengths of both the public and private sectors.  Broadbasing entrepreneurship by enabling small entrepreneurs with limited means to participate in large ventures. Some key objectives behind the promotion of the cooperative sector are:  Preventing concentration of economic power in the hands of a few  Enabling wider dispersal of ownership of productive resources  Actively involving people in the process of development  Augmenting productive resources, skills and capacities  Generating opportunities poverty Evolution of Government Policy        The idea of the joint sector was implicitly accepted in the Industrial Policy Resolutions of 1948 and 1956. Some early Five Year Plans also made references to the joint sector concept. The Companies Act, 1956 recognized the possibility of joint state-private ownership. The Dutt Committee Report (1969) strongly advocated the joint sector to curb economic concentration. Guidelines were issued in 1970 for the joint sector to be utilized in core and heavy industries. Public financial institutions were allowed to convert debt into equity to bring in joint ownership. Recent disinvestments have transformed some PSUs into joint sector enterprises. Cooperative Sector Introduction The cooperative sector has been assigned an important role in India's economic development across agriculture, rural industries, distribution etc. Objectives employment and alleviating Ways in which the State Supports Cooperatives  Equity participation cooperatives  Providing loans, subsidies and grants  Guarantees and contributions to risk funds  Tax concessions sanctions  Training programs educational initiatives  Deputing government officers and in legal and Major Segments of the Cooperative Sector  Agricultural credit cooperatives form the largest share  Processing cooperatives in sugar, textiles, rice milling etc.  Marketing and distribution cooperatives for farm produce  Functional cooperatives in dairy, fishery, housing etc.  Multipurpose tribal areas cooperatives National Level Federations in Cooperative Some important national federations are:  National Cooperative Union of India  National Cooperative Federation  National Cooperative Development Corporation  National Board Dairy Agricultural Marketing Development Key Problems  Regional disparities exist in the spread of cooperatives  Political interference and control over cooperatives Conclusion While playing an important developmental role, the cooperative sector needs reforms to enhance autonomy, efficiency and professionalism.