(1)QUESTION- According to you what should be the ideal role of

the government to facilitate healthy industries in the any economy?

ANSWER- The government has taken many steps to make India self-reliant,
increase employment and speed up the pace of economic growth by developing
industries in India. The most important step that the government took after
Independence was five-year economic plans, which focus on the growth and
development of industries.

A huge amount of money has been invested to develop the public sector in the
five year plans. The increase in the expenditure on public sector industries from
the first plan up to the eighth plan resulted in the growth of industries.

The government also focused on the establishment of basic industries to speed

up the economic development of the country. The substantial development in
the private sector achieved self-sufficiency in the production of industrial
consumer goods.
The government has taken steps to industrialise backward areas and to revive
sick industries. To achieve this, the government has set up the following
organisations.

 The Board of Industrial Finance and Reconstruction

 The National Renewal Fund.

The government played a major role in the revival of the textile industry when it
took over 125 sick cotton textile units and set up the National Textiles
Corporation to manage them.

Another important step that the government has taken to increase the rate of
industrial development is to provide financial help to various industries. It has
set up many financial institutions in the country to provide loans to the
industries.
The Industrial Finance Corporation, National Industrial Development
Corporation, the Industrial Credit and Investment Corporation of India or ICICI,
the Industrial Development Bank of India or IDBI and the Small Industries and
Development Corporation of India or SIDCO are some of the institutions.

The government also developed infrastructure like transport system which is

important for the development of industries. Transport system helps to deliver
raw materials to the industries as well as carry finished goods to the market. It
plays a very important role in increasing productivity.

The government also set up thermal power houses under the five -year plans to
increase the production of electricity and provide cheap electricity to the
industries. The Inventions Promotions Board was set up in 1960, which provides
financial and technical assistance to inventors to encourage industry related
inventions.

The Technical Development Board or TDB in 1976 was established to provide

financial assistance to the industries and other agencies. The government
liberalise its industrial policy in 1991 to encourage industrialisation because it
allows people to set up most industries, except a specified 18, without obtaining
a licence. It also encourages foreign investment and privatisation to bring a Free
Market Economy.

The liberalisation of industrial policy along with economic planning,

development of infrastructure like credit, transport system and electric power,
industrial innovation, technological development and setting up of industries
are some of the important steps that the government has taken to encourage
industrial development in the country.

The role of government in facilitating transactions between economic agents in

developing countries, where the level of information is often deficient and the
policy making process often fragmented and ad hoc, is not an easy one.
Moreover, although economic principles play a useful role in indicating the
general conditions under which government action will be most productive,
identifying the specific cases in which these principles apply and devising
effective measures are often difficult. However, a clear hierarchy of priorities
emerges
(2)QUESTION- for market-orientedExplaingovernments
businessesseeking to industrialize
fundamental rights effectively.
that they
First, developing the web of complex activities and relationships that
may respect from the constitution of any country?
characterize a sophisticated industrial sector becomes difficult, if not
impossible,
ANSWER- in the absencerights
Fundamental of clear, evenhanded
are important becauseand
theypredictable rules
guarantee certain of the
basics that are
game. These rules must be the primary concern of governments since only
needed for realising the full potential of the individual. Though India became an independent nation on
governments
15 August 1947, itcanwas provide them.
not until 26 JanuarySecond,
1950 thatan itsefficient and
citizens —at adequate
least supply
the educated ones of
— came
to know about the exact fundamental rights that were being guaranteed to them by the Constitution.
infrastructure services such as transport, communications, power, and
When the Constitution was written, there were no fundamental rights provided for the corporate or
education is also vital to modern industry. Governments must make sure these
business entity per se. Indeed, it would have been quite extraordinary if such provisions had been made
needs
at areiseffectively
all. There no constitutionmet, but this
anywhere does
in the not
world thatalways meancalled
has anything thatfundamental
the government
rights for
businesses.
should beNot theeven in the US,Inthe
provider. country
some in which
cases, the business
it may be more entity has overarching
appropriate to importance.
regulate
The fundamental rights for the citizens already guaranteed by the Constitution, when read along with
private monopolies in others, to allow competition among providers. Finally,
the directive principles of state policy, pretty well cover anything that the country's businesses could
governments
want. also intervene to change the way markets work. For instance to
prevent abuses, to improve welfare and to improve the pattern of investment
The right to freedom, for example, explicitly states that all citizens are free to choose any trade, set up
or output. It is there that the government's task is most difficult. The dividing
any business or follow any occupation. The right against exploitation and the right to equality are not
lines
just between
important measures
for the individual,that
theyimprove
are equallyand thoseforthat
important worsen
business theAnd
entities. conditions
the right to
under whichremedies
constitutional the private sector
is the final operates
protection. Theseisrights
often fine.
were Governments
designed should
for the individual —butusethey
fit nicely for business entities as well.
their scarce resources carefully. What is important is the particular way these
resources are deployed rather than the right or wrong level of their
development.