THE NEW INDUSTRIAL POLICY, 1991

The Industrial Policy plan of a country, sometimes shortened IP, is its official strategic effort to encourage the development and growth of the manufacturing sector of the economy. The government takes measures "aimed at improving the competitiveness and capabilities of domestic firms

and promoting structural transformation."

A country's infrastructure (transportation,

telecommunications and energy industry is a major

part of the manufacturing sector that usually has a key role in IP.

Industrial Policy Revolution

Industrial Policy Resolution of 1948 Industrial Policy Resolution of 1956 Industrial Policy Resolution of 1973 Industrial Policy Resolution of 1977 Industrial Policy Resolution of 1980 New Economic Policy of 1991

Why NIP 1991?

On 24th July 1991, the government headed by Mr.P V.Narasimha Rao, announced a new industrial

policy which sought to drastically alter the

industrial scenario in our country. There are several fundamental departures in the new policy. The most important initiatives are with respect to the virtual scrapping of industrial licensing and registration

policies, an end to the monopoly law and a more

welcoming approach to foreign investments, apart from redefining the role of the public sector.

Objectives: a) Self reliance to build on the many sided gains already made. b) Encouragement to Indian entrepreneurship, promotion of productivity and employment generation. c) Development of indigenous technology through greater investment in R & D and bringing in new technology to help Indian manufacturing units attain world standards. d) Removing weaknesses. the regulatory system and other

e) Increasing the competitiveness of industries for the benefit of the common man.

f) Incentives for the industrialization of backward areas.

g) Enhanced support to the small-scale sector.

h) Ensure running of public sector undertakings on business lines and cut their losses.
i) Protect the interests of workers. j) Abolish the monopoly of any sector in any field of manufacture except on strategic or security grounds. k) To link Indian economy to the global market so that we acquire the ability to pay for imports, and to make us less dependent on aid.

New Economic Policy (1991)

Industrial Sector Reforms

Public Sector Policy Industrial Licensing Policy MRTP Act

External Trade Reforms Foreign Investment Foreign Technology Agreements