(i) Education and health sectors are the two key sectors responsible for the formation of good quality human capital. The development of these two sectors are emphasized by almost all the less developed countries.
(ii) In India, expenditures on both education and health sectors are carried out by all the three tiers of the government and also by private institutions. While, private institutions are guided by market and profit motive, the public institutions are guided by the main motive of rendering services and to enhance human capital.
(iii) As the cost of education and health facilities provided by the private institutions is higher, so it is difficult for the majority of the population to avail these services because of their economic inability. Thus, it is very important for the government to provide quality education and health facilities to this section of the population.
(iv) As the Indian constitution counts right to free education and medical facilities as the fundamental right of citizens, So it is the responsibility of the government to provide education and health services to all, moreover, the private institutions are unable to reach the remote and rural areas where people lack initiative for education and health. In this context, the role of government is to encourage them and to make them aware of the advantages of education and health.
(v) There are some underprivileged sections of population like ST, SC, OBC, the interests of whose can only be protected by the interference of the government.
(vi) The people as individual consumers do not have complete information about the quality of services and the related costs. This often leads to the exploitation of people. Hence, the government intervention in health and education sector to regulate the fees structure is must in order to enhance the quality of human capital.