Public Sector Undertakings: Stars of the Growth Show

The growth of strategically important sectors is critical to the holistic development of any economy. PSUs are companies that operate in key industries that provide much needed development, allowing India to achieve superior GDP growth. The DSIJ Team discusses the performance of Maharatnas and Navratnas to help investors understand the contribution of key PSUs in today’s dynamic economic environment

The gross domestic product (GDP) which represents an all-inclusive perspective of an economy is made up of investments, government outlays, private and public consumption and net exports. As a result, by comparing GDP levels as an index, it offers investors insight into the economic growth trajectory. The Ministry of Finance has stated that the Indian economy is predicted to grow at 7 per cent in FY23 despite global headwinds, and retail inflation will moderate in line with wholesale inflation, which dropped to a 25-month low in January. A particular sector that is essential to a country’s overall development is its infrastructure, particularly for a developing nation like India that aspires to achieve double-digit GDP growth.

The success of the infrastructure industry is regarded as an indicator of economic growth as it acts as the backbone of any economy. The government has been making constant efforts to promote industrial growth, including the infrastructure sector. These efforts include, among other things, establishing a legal framework to foster an encouraging business environment, enhancing the infrastructure network and ensuring the availability of necessary inputs. Given the significance of the industry, the government has given infrastructure development much greater priority, and in the Union Budget for 2023-24, it raised the outlay for capital expenditure on infrastructure by 33 per cent to Rs 10 lakh crore.