Write a short note on India’s Industrial Policy 1948
The first industrial policy itself paved the path for a mixed economy in the nation. It accepted the existence of both public and private sectors in the economy. It assigned a progressive role for the State, for investment in industrialisation, and in regulating the private sector. It also accepted the importance of small and cottage industries in the development of local resources such as capital, labour, raw material, etc. It recognised the role of foreign capital in industrial development but stated that there should be strict regulation of foreign capital.
The 1948 policy divided the industry into four categories:
1. Industries where the State had a Monopoly: Three industries were put under this category: Arms and Ammunition, Atomic Energy, and Rail Transport.
2. New Investment by State: Six industries were specified under this: coal, iron and steel, aircraft manufacturing, ship building, manufacture of telephone, telegraph, and wireless apparatus (excluding radio sets) and mineral oil. However, existing private sectors were allowed to continue for ten years after which the government could review the situation and acquire any undertaking.
3. The Field of Government Control: These industries were to be regulated and directed by the government. Some of these industries were automobiles, heavy chemicals, heavy machinery, machine tools, fertilisers, electrical engineering, sugar, paper, cement, cotton, and woolen textiles.
4. Industries open to Private Sector: The remainder of the industrial field was open to the private sector.