The changing role of public sector is clear from the following trends:
1. Restricting the role of public sector only to critical areas: The reservation of industries exclusively for the public sector has been reduced from 17 to 8 and further to 3 only.
2. Performance improvement through Memorandum of Understanding (MOU): Under this government lays down performance targets for the management and givesgreater autonomy to hold the management accountable for the results.
3. Disinvestment: Equity shares of public sector enterprises were sold to private sector and the public. It was expected that this would lead to improved managerial performance and better financial discipline.
4. Restructure and Revival: All public sector sick units were referred to Board of Industrial and Financial Reconstruction (BIFR). Units which were potentially viable were restructured and which could not be revived were closed down by the board.
