What do you Mean by ‘Public Investment’?
Investment is broadly classified as public investment and private investment, Public investment is an investment made by the central or the state government for the public welfare. While an investment made by an individual, or a group of private investors is known as a private investment. Public investments are made in some specific sectors by revenue collected from the taxes. In India, public investment is mainly done in the sectors like agriculture, infrastructure, health, education, etc.
The public investment contributes around 2.2% to the GDP of India which is likely to increase up to 2.9% by 2023.
Importance of Public Investment for India’s Economic Growth
If you take a closer look at the economic growth of any nation, you’ll find that it is mainly driven by the investments made in development works. However making huge investments in any economy is as not easy as it sounds, as huge investment can’t be done by a single person, it usually involves a group of people (investors). However still any private organization of an individual can’t invest much, thus in such a case, public investment becomes quite important. The public investment not only benefits the netizens by providing them better services at a cheaper rate but also boosts the economic growth of a nation.
For the financial year 2022-23, the Government of India has decided to increase the share of public investment by 35%.