Before independence, policy of the government was charaterised by laissez-faire i.e. non-interference policy in the affairs of industries. Industrial development was left to the exclusivecare of private sector. However, in the post independence era, government has been taking anactive interest in the development of industries in India. So far, government has formulated fiveindustrial policies i.e. Industrial Policy 1948, 1956, 1977, 1980 and 1991 respectively.
Industrial Policy Resolution, 1948
The first industrial policy was announced in April 1948 by the then Industrial Minister, Late Mr.S.P. Mukherjee. Its historic importance lies in the fact that it ushered in the system of
in the country i.e. it entrusted the task of industrial development on both private andpublic sectors.
1. Development of mixed economy
2. State programmes for the development of industries.
3. Promotion of small scale and cottage industries,
4. Foreign investment was allowed but effective control should be with Indians.
5. Classified industries into four categories : (a) Public Sector (b) Mixed Sector (c) ControlledPrivate Sector (d) Private and cooperative sector.
Industrial Policy Resolution, 1956
IPR, 1956 was the most comprehensive industrial policy which was formulated in the backdropof the adoption of the constitution and the socio-economic goals. The policy may be described asthe
of India as it not only outlined the basic framework of the futureindustrial
policies (especially upto 1991) but also of the general economic policies. Its mainobjectives were to accelerate the rate of economic growth and to speed up industrialization for achieving a 'socialistic pattern of society/
(1) The policy divided the industries into three categories •
Schedule A (Public Sector)
' Seventeen industries were exclusively reserved for the publicsector. These include arms and ammunition, atomic energy, iron and steel, heavy machinery,heavy electrical parts, mineral oil, coal, air transport, railways, shipping, telephones, wirelessapparatuses, copper, lead, zinc mines and electricity.
) Schedule B (Mixed Sector)
: Twelve industries were placed in the mixed sector of publicand private enterprise. These were to be progressively state-owned and in which state wouldgenerally set up new units. These include • machine tools, aluminium, drugs, chemical fertilizersetc.
Schedule C (Private Sector)
; All the remaining industries and their future developrtientwould, in general be left to the initiative and enterprise of the private sector.
(2) The policy laid emphasis on the state assuming a predominant role for setting up newindustrial undertakings.
(3) The state was to facilitate and encourage the development of industries in the private sector by ensuring the development of transport, power etc. and by appropriate fiscal and other measures.
(4) The state would support small-scale and, cottage industries through positive discriminatory
measures like reservation of items for SSI, differential taxation, subsidies etc.