Private Sector and its Components

Private sector refers to that part of the economy which is owned and managed by private individuals or enterprises. The private sector operates for profit and is usually made up of businesses that are not controlled or owned by the government.

Private sector can be divided into two categories:

1. Domestic Private Sector
2. Foreign Private Sector

Domestic Private Sector

Domestic private sector refers to those enterprises that are owned and managed by individuals who are residents of the country. It comprises of small and large enterprises, both in manufacturing and service sectors.

The domestic private sector can further be divided into two categories:

1. Organized Sector
2. Unorganized Sector

Organized Sector

Organized sector refers to those enterprises that are registered and regulated by the government. They follow the rules and regulations set by the government and are accountable to it. The organized sector includes large companies, public sector enterprises, multinationals, and other formal enterprises.

Unorganized Sector

Unorganized sector refers to those enterprises that are not registered or regulated by the government. They are usually small and operate informally. The unorganized sector includes small shops, vendors, artisans, and other informal enterprises.

Foreign Private Sector

Foreign private sector refers to those enterprises that are owned and managed by individuals who are not residents of the country. They operate for profit and are usually multinational corporations.

Conclusion

In conclusion, the private sector is an important part of the economy. It provides employment and contributes to economic growth. The domestic private sector is divided into organized and unorganized sectors, while the foreign private sector comprises of multinational corporations.