இந்தக் கட்டுரையில், TNPSC குரூப் 1, குரூப் 2, குரூப் 2A, குரூப் 4 மாநிலப் போட்டித் தேர்வுகளான TNUSRB, TRB, TET, TNEB போன்றவற்றுக்கான முறைகள் இலவசக் குறிப்புகளைப் பெறுவீர்கள்.தேர்வுக்கு தயாராவோர் இங்குள்ள பாடக்குறிப்புகளை படித்து பயன்பெற வாழ்த்துகிறோம்.
Industrial Growth
Impact of Industries in Indian Economy
Need for Industrialisation
The need for and role of the industrial sector have been fully recognised by development
thinking all over the world.
Industrial sector through its forward and backward linkages with other sectors plays a very
important role in achieving rapid growth and development.
Most modern and rich countries have well-developed industrial sector through their early
industrial revolution.
Industrialization means widespread development of manufacturing vast quantities of goods,
employing a large number of people, promoting international market, characterization
of specialized skill, science, technology, increasing application of electrical, electronic,
computer technologies to enhance productivity.
Absence of such rigorous industrialisation is the main reason for the backwardness of many
poor countries too.
Hence, the modern development strategies attach more emphasis to rapid industrialization
to achieve faster growth and progress.
The following are some of the important needs for the industrial sector:
Raising National Income
Employment Opportunities
Higher Living Standard
Promoting Exports
Capital Formation
Technological Progress
Raising National Income
Vigorous industrialisation ensures a solid and sustained base to increase the national
income of an economy.
A larger share of the National income of industrially advanced economies comes from the
industrial sector.
Employment Opportunities
Availability of surplus labour and unemployment are the major challenges of development
strategy.
Industrialization uses the productive resources of the economy and expands employment
opportunities which in turn will improve the income and wellbeing of the people.
Higher Living Standard
The increasing national income through industrialisation helps to meet the demands of the
people for industrial products.
It is also expected to improve the standard of living of the people by increasing their per
capita income.
This is possible only through a well-designed growth process.
Promoting Exports
Industrially advanced countries are able to export more and earn large foreign exchange.
The income elasticity of industrial goods is very high than that of the primary goods.
Hence, exports can be promoted to earn adequate foreign exchange by producing advanced
industrial goods.
Capital Formation
Expanding employment opportunities, income generation through rapid industrialisation
will also lead to increased saving and capital formation in the economy.
This will help to diversify and expand the industrial base further through higher investment.
Technological Progress
The Industrial sector will also promote technological progress through its course of
development and expansion.
The technological advancements and their dynamic contents provide the required
elements to strengthen the economy as a whole
Industrial policy 1
An effective industrial policy is essential for any industrialised nation.
It enables the State to have proper policies, rules and regulations so that the industries can
be regulated and the process of industrialization benefits the economy and the society.
It deals with the norms and regulations relating to the industries.
Industrial Policy Resolution 1948
It was announced by the Minister of Industries and Commerce Shyama Prasad
Mukherje.
Salient Features of IPR 1948
Development of mixed economy.
State programme for the development of industries.
Promotion of small and cottage industries.
IPR 1956
Described as the Economic Constitution of India.
Its main objectives were to accelerate the rate of economic growth and to speed up
industry nation for achieving a socialistic pattern of society.
Salient features :
Schedule A (Public sector) seventeen industries were exclusively reserved for the public
sector.
Schedule B (Mixed sector) twelve industries were placed in the mixed sector of the public
and private sector. These were estate owned and in which State would generally set up
new units.
Schedule C (private sector) all the remaining industries and their future development, in
general, be left to the inactive and enterpriser of the private sector.
Industrial Policy Resolution 1948
As the Indian system incorporated the concept of a mixed economy, the Industrial Policy
Resolution adopted in 1948 emphasised that both the public sector and private sector
would function in their respective spheres.
All the key industries were to be under the control of the Central Government.
The public sector had control over arms and ammunitions, the production and control of
atomic energy, railways etc. which were to be the exclusive monopoly of the Central
Government.
The State also had control over coal, iron and steel, aircraft manufacturing, shipbuilding
etc., Private enterprises and cooperatives managed the remaining industries.
Industrial Policy Resolution 1956
The first Five Year Plan got completed and efforts were taken towards the attainment of a
socialistic pattern of society.
A new industrial policy was formulated and was adopted in April 1956. As per this policy,
three categories of industries were specified.
There were industries which were totally controlled by the State, industries which were
owned by the state and the private enterprises which could supplement in the
management of such industries and the third category of industries were those which
were exclusively managed by the private enterprises.
The industries of the private sector were to be encouraged by the state by improved
systems of transport, power sector and other services.
The small-scale industries and cottage industries were also to be encouraged by the State.
There had to be a uniform development in all the regions so that the benefits of
development could reach all sections of the population.
In December 1977, the Janata Government announced a new industrial policy.
The main elements of the policy were development of small scale sector which were
categorised into cottage and household industries, tiny sectors and small scale
industries.
Such small-scale industries were to generate employment and were also to reduce the
concentration of wealth and power in the hands of big industrialists.
However, the large-scale industries had to depend on their existing resources for their new
projects.
But this policy could not come to force because of the fall of the Janata Government.
Industrial Policy 2
Monopoly and Restrictive Trade Practices ( MRTP) Act 1969
MRTP Act was enacted in 1969 and MRTP Commission was constituted in 1970 to prevent
the concentration of economic power and to prohibit restrictive or unfair trade
practices.
Under the act, companies having assets beyond the threshold limit (i.e., Rs. 20 crore in
1985) were placed under the preview of the act.
Certain restrictions are imposed on such companies like prior approval of the MRTP
commission for th establishment of new undertakings, expansion of undertakings,
mergers, and acquisition.
In December 1977, the Janata Government announced a new industrial policy.
The main elements of the policy were development of small scale sector which were
categorised into cottage and household industries, tiny sectors and small scale
industries.
Such small-scale industries were to generate employment and were also to reduce the
concentration of wealth and power in the hands of big industrialists.
However, the large-scale industries had to depend on their existing resources for their new
projects. But this policy could not come to force because of the fall of the Janata
Government.
Industrial Policy Statement, 1977
In December 1977, the Janata Government announced its New Industrial Policy through a
statement in the Parliament.
The main thrust of this policy was the effective promotion of cottage and small
industries widely dispersed in rural areas and small towns.
In this policy, the small sector was classified into three groups—cottage and household
sector, tiny sector and small scale industries.
The 1977 Industrial Policy prescribed different areas for large-scale industrial sector- Basic
industries, Capital goods industries, High technology industries and Other industries
outside the list of reserved items for the small-scale sector.
The 1977 Industrial Policy restricted the scope of large business houses so that no unit of
the same business group acquired a dominant and monopolistic position in the
market.
It put emphasis on reducing the occurrence of labour unrest. The
Government encouraged the worker’s participation in management from shop floor
level to board level.
Criticism: The industrial Policy 1977 was subjected to serious criticism as there was an
absence of effective measures to curb the dominant position of large-scale units and
the policy did not envisage any socioeconomic transformation of the economy for
curbing the role of big business houses and multinationals.
Industrial Policy 3
Industrial Policy Statement, 1980
The Industrial Policy Statement of 1980 addressed the need for promoting competition in
the domestic market, modernisation, selective liberalisation, and technological up-
gradation.
Due to this policy, the MRTP Act (Monopolies Restrictive Trade Practices) and FERA Act
(Foreign Exchange Regulation Act, 1973) were introduced.
The objective was to liberalise the industrial sector to increase industrial productivity and
competitiveness of the industrial sector.
The policy laid the foundation for an increasingly competitive export-based and for
encouraging foreign investment in high-technology areas.
New Industrial Policy 1991
In 1991, India approached International Bank for Reconstruction and Development (IBRD),
popularly known as World Bank and International Monetary Fund (IMF) and received $ 7
million as loan to repay the external borrowings.
These international agencies expected India to liberalise and open up the economy by
removing restrictions on private sector and remove trade restrictions between India and
other countries.
India agreed to the conditions of the World Bank and IMF and announced New Economic
Policy (NEP) which consists of wide range of economic reforms.
This new set of economic reforms is commonly known as the LPG or Liberalisation,
Privatisation and Globalisation model.
Dimensions of New Economic Policy
The base for New Economic Policy in various countries of the world is Dunkel Draft, which
was all about the General Agreements on Trade and Tariff.
Mr. Arthur Dunkel (1932-2005) submitted a 22000 page document for the World Trade
Organisation (WTO) and was followed by many Nations to adopt their respective New
Economic Policies.
India is one among such nations to commit itself to the New Economic Policy in 1991.
Liberalisation
Liberalisation refers to laws or rules being liberalised, or relaxed, by a government.
Liberalising trade policy by the government includes removal of tariff, subsidies and other
restrictions on the flow of goods and services between the countries.
Liberalisation is the result of New Industrial Policy which abolished the "License system" or
“Licence Raj”.
Forms of Liberalisation
The Government of India has adopted several measures of liberalisation. Some of these
measures are:
Liberalisation for industrial licensing:
In India, it was mandatory to obtain license before liberalisation for setting up certain
industries.
After liberalisation, all industries except six specific industries were liberalised i.e., free
from obtaining license.
Freedom for expansion and production to industries:
Earlier government used to fix the maximum limit of production capacity.
Now the industries are free to decide their production limits by their own on the basis of
the requirement of the markets.
Increase in the investment limit of the small industries:
Investment limit of the small-scale industries has been raised to Rs. 1 cr.
So these companies can upgrade their machinery and improve their efficiency.
Foreign Exchange Reforms:
In 1991, as an immediate measure to resolve the balance of payments crisis, the rupee
was devalued against foreign currencies.
This led to an increase in the inflow of foreign exchange.
Liberalisation of export and import transactions:
By simplifying procedures for imports and exports the government wanted to permit
the international flow of goods, services, capital, human resources and technology,
without many restrictions.
Privatisation
Privatisation is the incidence or process of transferring ownership of a business enterprise,
agency or public service from the government to the private sector.
Privatisation means permitting the private sector to set up industries which were previously
reserved for the public sector.
Under this policy, many Public Sector Units (PSUs) were sold to the private sector and PSUs
were running in losses due to mismanagement and political interference.
The managers could not work independently, and the production capacity remained under-
utilized and to increase competition and efficiency privatisation of PSUs was inevitable.
Bharat Aluminium Co. Ltd., (BALCO)
Hindustan Zinc Ltd (HZL)
Indian Petrochemicals Corporation Ltd (IPCL)
Maruti Udyog Ltd (MUl)
Modern Food Industries Ltd (MFIL)
India Scooters Limited – The first ever company Privatized in India.
Forms of Privatisation
Contraction (minimisation) of public sectors:
The number of industries reserved for public sector was reduced from 17 (as per
1956 policy) to only 8 industries viz, Arms and Ammunition, Atomic Energy, Coal and
Lignite, Mineral oils, Mining of ores, Mining of copper, lead, zinc etc., Minerals for
atomic energy and Railways.
Sales of shares of public sectors to the private sector:
Indian Govt. started selling shares of PSUs to public and financial institution.
Now the private sector will acquire ownership of these PSU’s and the share of private
sector has increased from 45 % to 55 % in the year 2011 and after.
Memorandum of Understanding:
MoU system was introduced in 1991 to raise the productivity and performance of PSUs.
It strengthens the relationship between PSUs and administrative departments.
The main work of MoU is to judge the PSUs and level their performance.
Disinvestment in PSUs:
The Government has started the process of disinvestment in those PSUs which had been
running into loss. It means that Government has been selling out these industries to
the private sector.
So disinvestment is a system of privatising the government enterprises.
Globalisation
Globalisation means the interaction and integration of the domestic economy with the rest
of the world with regard to foreign investment, trade, production, and financial matters.
Globalisation stands for the consolidation of the various economies of the world.
Globalisation results from the removal of barriers between national economies to
encourage the flow of goods, services, capital, and labour.
While the lowering or removal of tariffs and quotas that restrict free and open trade among
nations has helped in globalising the world economy.
Forms of Globalisation
Foreign trade policy:
India has signed a number of agreements in order to expand Indian trade worldwide.
Some of the agreement includes TRIPS (Trade-Related Intellectual Property Rights), GATS
(General Agreement on Trade in Service).
Export promotion:
Globalisation promotes export by reducing quotes and tariffs, by eliminating trade
restrictions and simplifying trade procedures.
Freedom to repatriate:
Repatriation means, to send or bring money back to one’s own country.
Since globalisation has integrated many countries, repatriation has become very easy.
Reduction in tariffs:
Custom duties and tariffs imposed on imports and exports are reduced gradually to
make the Indian economy attractive to global investors.
Encouraging open competition:
Globalisation brings an end to the difference between domestic and international
markets.
Highlights of the LPG Policy
Given below are the salient highlights of the Liberalisation, Privatisation and Globalisation
Policy in India:
Introduction of new Foreign Trade Agreements
Foreign Investment (FDI & FII)
MRTP Act, 1969 (Amended)
Deregulation
Opportunities for overseas trade
Steps to regulate inflation
Tax reforms
Abolition of License
Globalisation and Liberalisation are concepts closely related to one another, and both
globalisation and liberalisation refer to relaxing social and economic policies which
results in better integration with an economy and between nations.
Competition Act, 2002
The Monopolies and Restrictive Trade Practices Act (MRTP), 1969 was repealed by the
Ministry of Corporate Affairs, and this was replaced by the Competition Act,2002, which
was later amended in 2007 and 2009.
The MRTP Act had the objective of preventing the concentration of money and checking
unfair practices in trade so that monopolistic practices could be stopped. But, the new
Act encouraged freedom of trade so that there was healthy competition and the
consumer could get the best products.
Emphasis was given to regulating the activities of the companies.
The companies did not have to get the prior approval of the government in making changes
in their establishments.
In spite of many efforts towards industrialisation, there are also few inadequacies. India still
has the problem of unemployment and underemployment.
Uniform development in all regions is a challenge to the policymakers and the larger
society.
Even after long years of independence and industrialisation, governments have to still
design programmes for poverty eradication.
The industrialisation process leads to the development of large sectors but the small and
medium sectors still have a long way to go.
More and more industries are concentrated in cities. In terms of development, there is a
vast difference between the urban areas and the rural areas. Issues relating to
urbanisation and migration are bigger challenges to the state.
**************************************************************************
| Adda247 TamilNadu Home page | Click here |
| Official Website=Adda247 | Click here |
