Write the advantages of Joint venture.
Or, Discuss the benefits of Joint venture.
Or, Discuss the merits of Joint venture.
Joint venture is a partnership between the public and private sectors. The joint venture companies look at profit-making as well as public welfare activities. The advantages of joint venture are:
1. Cooperation or coexistence:
Although there are financial resources in the government sector, there is very little skill and experience in running a business. On the other hand, business experience and management skills are much higher in the private sector, but financial capacity is limited. That is why setting up a business in a joint venture combines efficient management of the private sector with public capital and risk-bearing capacity.
2. Balanced regional development:
The government decides on which industries will be set up in the joint venture. In other words, according to the government plan, industrial development is done on the basis of the priority policy of regional development. As a result, balanced regional development in the field of industry is possible.
3. Overall welfare of the people:
The purpose of the welfare state is to supply goods at fair prices, eliminate inequality, and end regional inequality in the industry. But the profiteering of the private sector often neglects these social aspects. The joint venture does overall welfare of the people.
4. Maximum use of technology:
With the excellence of technology in the private sector, maximum use of technology is possible as a result of the use of government cap[ital.
5. Expansion of the public sector:
It is generally seen that the amount of investment in the public sector is high but the amount of profit is low. On the other hand, the amount of investment in the private sector is less but the rate of profit is higher. Therefore, through joint ventures, the government gets an opportunity to earn profit by investing in profitable industries.
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