INDIA�S INDUSTRIAL
POLICIES FROM 1948 TO 1991
OFFICE OF THE
DEVELOPMENT COMMISSIONER
(SMALL SCALE INDUSTRIES)
MINISTRY OF SMALL
SCALE INDUSTRIES
GOVT. OF
INDIA
NEW
DELHI
INDUSTRIAL POLICY
RESOLUTION
New Delhi,
6 April, 1948
No. 1(3)-44(13)/48-The
Government of India have given careful thought to the economic problems
facing the country. The nation has now set itself to establish a social
order where justice and equality of opportunity shall be secured to all
the people. The immediate objective is to provide educational facilities
and health services on a much wider scale, and to promote a rapid rise
in the standard of living of the people by exploiting the latent
resources of the country, increasing production and offering
opportunities to all for employment in the service of the community. For
this purpose. Careful planning and integrated effort over the whole
field of national activity are necessary: and the Government of India
propose to establish a National Planning Commission to formulate
programmes of development and to secure their execution. The present
statement, however, confines itself to Government�s policy in the
industrial field.
2. Any improvement in
the economic conditions of the country postulates and increase in
national wealth: a mere redistribution of existing wealth would make no
essential difference to the people and would merely mean the
distribution of poverty. A dynamic national policy must, therefore, be
directed to a continuous increase in production by all possible means,
side by side with measures to secure its equitable distribution. In the
present state of the nation�s economy, when the mass of the people are
below the subsistence level, the emphasis should be on the expansion of
production. Both agricultural and industrial; and in particular on the
production of capital equipment of goods satisfying the basic needs of
the people and of commodities the export of which will increase earnings
of foreign exchange.
3. The problem of
State participation in Industry and the conditions in which private
enterprises should be allowed to operate must be judged in this context.
There can be no doubt that the State must play a progressively active
role in the development of industries, but ability achieve the main
objectives should determine the immediate extent of State responsibility
and the limits to private enterprise. Under present conditions, the
mechanism and the resources of the State may not permit it to function
forthwith in industry as widely as may be desirable. The Government of
India are taking steps to remedy the situation; in particular, they are
considering steps to create a body of men trained in business methods
and management. They feel, however, that for some time to come, the
State could contribute more quickly to the increase of national wealth
by expanding its present activities wherever it is already operating and
by concentrating on new units of production in other fields, rather than
on acquiring and running existing units. Meanwhile, private enterprise,
properly directed and regulated, has a valuable role to play,
4. On these
considerations the Government have decided that the manufacture of arms
and ammunition, the production and control of atomic energy, and
ownership and management of railway transport should be the exclusive
monopoly of the Central Government. Further in any emergency, the
Government would always have the power to take over any industry vital
for national defence. In the case of the following industries, the state
which in this context, includes Central, Provincial and State
Governments and other Public Authorities like Municipal Corporations
will be exclusively responsible for the establishment of new
undertakings, except where, the national interest, the State itself
finds it necessary to secure the co-operation of private enterprise
subject to such control and regulation as the Central Government may
prescribe:
1.
Coal (the India Coalfields Committee�s proposals will be
generally followed).
2.
Iron and Steel.
3.
Aircraft manufacture.
4.
Shipbuilding.
5.
Manufacture of telephone, telegraph and wireless apparatus,
excluding radio receiving sets.
6.
Mineral oils.
While the inherent
right of the State to acquire any existing industrial undertaking will
always remain, and will be exercised whenever the public interest
requires it, Government have decided to let existing undertakings in
these fields develop for a period of ten years, during which they will
be allowed all facilities for efficient working and reasonable
expansion. At the end of this period, the whole matter will be reviewed
and a decision taken in the light of circumstances obtaining at the
time. If it is decided that the State should acquire any unit, the
fundamental rights guarantee by the Constitution will be observed and
compensation will be awarded on a fair and equitable basis.
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