Examining The Post Independence Economic Development Of India

The station independency economic development of India is alone in several ways. In an advanced attempt, the establishing male parents adopted the in-between class of a assorted economic system, delegating a polar function to public sector in the industrialisation of India. This new attack to the socio-economic growing of the state, which had suffered centuries of subjection, was set within a model of federal civil order based on parliamentary democracy vouching cosmopolitan franchise.

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Soon after independency, India had to cope with assorted issues in bordering a suited industrial policy for the state. These were the followers.

Policy of the Government towards foreign engagement in industrial enterprises.

Determination of the comparative functions of public and private sectors.

Relative accent on consumer goods and capital goods industries.

Role of big vis-a-vis little graduated table industries.

Location of industries: economic versus societal standards.

Concentrated versus wide based entrepreneurship.

Licensing policy, processs, regulations and ordinances to command industrial activities.

Hence to carry through the objects and to ease the growing Industrial development in the state, the industrial policies and Acts of the Apostless were framed for the state. Post 1991, the chief steps taken by the Government were the Industrial Policy Resolution,1948, Industrial ( Development and Regulation ) Act, 1951 and Industrial Policy Resolution, 1956.

Industrial Policy Resolution, 1948

The Government of India ‘s industrial policy after independency was shaped loosely in footings of the Industrial Policy Resolution, 1948. That declaration emphasized clearly the duty of Government in the affair of advancing, helping and modulating the development of industry in the national involvement. It envisaged for the populace sector an progressively active function. While it reiterated the built-in right of the State to get any industrial project whenever the public involvement requires it, it laid down, in position of the fortunes so bing, a certain limit of Fieldss for the public and private sectors.

The necessities of authorities policy in the domain of industrial development were stated in the Industrial Policy Resolution of April, 1948. The Resolution listed certain industries like the industry of weaponries and ammo, the production and control of atomic energy and the ownership and direction of railroad conveyance as being reserved entirely for the Cardinal Government. In the instances of certain other industries besides such as coal, Fe and steel, aircraft industry, ship-building, industry of telephone, telegraph, radio setup and mineral oils, the State, including the Central and State Governments and other public governments, would be responsible for farther development except to the extent that it regarded the co-operation of private endeavor necessary for that intent. The remainder of the industrial field was to be unfastened to private endeavor, single every bit good as co-operative, but the province would step in whenever the advancement of any industry under private endeavor was found to be unsatisfactory. Cardinal ordinance and control was envisaged for 18 specified industries of particular importance from the points of position of the investing and proficient accomplishment involved.

Industrial ( Development and Regulation ) Act, 1951

Among the of import aims of this Act are:

to guarantee the constitution of new industrial capacities harmonizing to national precedences and

to modulate by and large the location of industrial endeavors so as to procure balanced regional development.

The industrial licensing system, owing to its legal authorization to the Act, is the chief instrument to direct investings into coveted channels of industrial activity. Broadly, the range of licensing system is restricted to the ordinance of big sized investings in industries listed in the First Schedule of the Act. Although the licensing system is recognized by the Government as a positive instrument for accomplishing planned industrialisation, the concern community has looked upon it as a faltering block in the manner of rapid industrial growing. Licensing system has now been abolished except for a few industries.

Industrial Policy Resolution, 1956.

The 1948 Resolution was reviewed in the visible radiation of experience gained, and the new Industrial Policy Resolution was placed before the Parliament by the Prime Minister on the thirtieth April, 1956 which had the undermentioned characteristics:

The Resolution classified industries in 3 classs, holding respect to the portion which the province would play in each one of them. The classs are-

The first class shown in Schedule A, consisted of industries the hereafter development of which would be sole duty of the State.

In the 2nd class, shown in Schedule B, were industries which would be increasingly province owned and in which, hence, the State would by and large take the enterprise in set uping new projects, but in which the private endeavors would be besides be expected to supplement the attempts of the State.

The 3rd class comprised of all the staying industries, the farther development of which would, in general be left to the enterprise and endeavor of the private sector.

One thing to be noted here was that the categorization was non stiff or watertight. For case, in the Schedule A industries the enlargement of bing in private owned units was non precluded and the State was free to procure the cooperation of private endeavor in the constitution of new units when the national involvement so needed, capable to the provision that while procuring such cooperation, it would guarantee, through bulk engagement in the capital of the project or otherwise, that it had the needed powers to steer the policy and command the operations of the project.

Besides there was encouragement to little graduated table industries. as the importance of small-scale and bungalow industries was recognized in the context of employment chances and just distribution of economic power.

The 1956 industrial policy proposed decrease in regional instabilities through proviso of infrastructural installations ( conveyance, power etc. ) in comparatively backward countries of the state.

The function of foreign capital endeavor was recognized.

The 1956 declaration stressed the demand to better the on the job conditions of the labor.

Industrial Development 1991 onwards

The new industrial policy was announced by so Prime Minister Mr. Narsimha Rao in the Indian Parliament on 24 July, 1991. The new policy introduced extremist alterations “ to unshackle the Indian industrial economic system from the cobwebs of unneeded bureaucratic controls. “ Some of the commissariats of the new policy, which has already proved a watershed in the post-independence history of India, were the followers:

It abolished industrial licences for all undertakings, except for a short list of 18 specified industries related to ( a ) security and strategic, ( B ) risky chemicals, ( degree Celsius ) points of elitist ingestion ( vitamin D ) environmental concerns and ( vitamin E ) societal grounds. After farther delicensing, there are, soon, merely six industries under mandatory industrial licensing. These are:

Distillation and brewing of alcoholic drinks.

Cigars and coffin nails of baccy and manufactured baccy replacement.

Electronic aerospace and defense mechanism equipment ; all types

Industrial explosives including exploding fuses, safety fuses, gunpowder, nitrocellulose and lucifers.

Hazardous chemicals.

Drugs and pharmaceuticals ( bulk drugs industry has been delicensed )

It removed the plus bounds for MRTP wholly.

It raised the bound for foreign equity keeping from 40 per cent to 51 per cent.

It announced disinvestment in public sector projects in favor of common financess, fiscal establishments, workers and general populace. At present there are merely 4 industries reserved for the public sector. These are:

Weaponries and Ammunition and allied points of defense mechanism equipment, defense mechanism aircrafts and war vessels

Atomic energy

The substances specified in the agenda to the Notification Number S. O 212 ( E ) dated March 15, 1995 of the Government of India in the section of Atomic Energy.

Railway conveyance

Harmonizing to the new policy, inveterate ill public sector units were to be referred to the Board for Industrial and Financial Reconstruction.

Industries reserved for the little graduated table sector will be continued to be reserved so.

Social security mechanism for workers. It besides promised to advance workers ‘ engagement in direction and proposed workers ‘ co-operatives to do ill units healthy.

The Government has, with this new economic policy, tried to transform the economic system into a vibrant, outward looking, liberated market economic system driven by forces of competition, productiveness and efficiency, and for this it expects the employers and workers to appreciate the inevitableness of alteration and maximise the benefits to be derieved from the new work ethos. The authorities has considered the province of industrial development in the state as a good barometer to mensurate the wellness of economic system, its rate of growing and alterations in its orientation towards higher productiveness, efficiency and fight.

Decision

India has made considerable economic advancement since its Independence. Most noticeable are the enlargement and variegation of production both in industry and agribusiness. New engineerings were introduced in many industries. Industrial investing took topographic point in a big assortment of new industries. Modern direction techniques were introduced. An wholly new category of enterprisers have come up with the support system from the Government, and a big figure of new industrial Centres have developed in about all parts of the state. Over the old ages, the Government has built the substructure required by the industry and made monolithic investings to supply the much-needed installations of power, communications, roads etc. A good figure of establishments were promoted to assist entrepreneurship development, provide finance for industry and to ease development of a assortment of accomplishments required by the industry every bit good as agribusiness. The Government besides followed a policy of promoting autochthonal industries and supply them all installations and

encouragement. As a consequence, we have now a widely diversified base of industry and an increased domestic production of a broad scope of goods and services. The index of industrial production has gone up from 7.9 in 1950-51 to 154.7 in 1999-2000. Electricity coevals went up from 5.1 billion Kwh to 480.7 billion Kwh in the same period.

This economic enlargement contributed to a steady and impressive growing in India ‘s GNP. With the exclusion of 4 old ages, India experienced a positive rate of growing. As a consequence, India ‘s per capita Net National Product ( NNP ) in 1999-2000 was 2.75 times higher than that of 1951. The rate of growing before 1980 was 1.2 % per capita. Thereafter, it grew at the rate of 2.4 % , and between 1950-90, by 3.2 % on norm every twelvemonth. Between 1993- 94 and 1999-2000, it registered an mean rate of growing of 4.8 % per twelvemonth.

A assortment of promotional policies were followed by the Government to accomplish this success. In the early old ages, Indian industry thrived within protective duty walls. The policy was to promote Indian industries and though foreign proficient coactions were encouraged, direct foreign investing in any corporate organic structure was restricted to 40 % . In 1991, this policy was changed wholly and foreign bulk investing was encouraged in a assortment of industries, import limitations were removed, imposts duty was brought down and the doors of the Indian economic system were opened for foreign competition which led to rocketing of industrial growing of the economic system and set out a new skyline for the state to accomplish.

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