Classification of an enterprise into public or private sector is based on

Economic activities are classified into the public or private sector primarily based on the ownership of assets and the responsibility for service delivery [2]. In the public sector, the government owns most of the assets and provides essential services, such as the railways or post offices. Conversely, in the private sector, ownership of assets and the delivery of services are managed by private individuals or companies, such as TISCO or Reliance Industries. While other criteria exist for different classifications—such as the number of employees for determining business size (SMEs) [4] or employment conditions for distinguishing between organized and unorganized sectors —the fundamental distinction between public and private enterprises remains the nature of ownership [3]. Private sector entities are typically profit-oriented, whereas public sector firms often focus on public service provision.

Sources

1. [2] Understanding Economic Development. Class X . NCERT(Revised ed 2025) > Chapter 1: DEVELOPMENT > CHAPTER 2: SECTORS OF THE INDIAN ECONOMY > p. 17
2. [4] Environment and Ecology, Majid Hussain (Access publishing 3rd ed.) > Chapter 11: Contemporary Socio-Economic Issues > Privatisation > p. 12
3. [1] Understanding Economic Development. Class X . NCERT(Revised ed 2025) > Chapter 2: SECTORS OF THE INDIAN ECONOMY > SECTORS IN TERMS OF OWNERSHIP: PUBLIC AND PRIVATE SECTORS > p. 32
4. [3] https://www.oecd.org/en/data/indicators/enterprises-by-business-size.html