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INDUSTRIAL POLICY

INDUSTRIAL AND COMMERCIAL POLICY 2011

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.

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:

  • Coal (the India Coalfields Committee's proposals will be generally followed).

  • Iron and Steel.

  • Aircraft manufacture.

  • Shipbuilding.

  • Manufacture of telephone, telegraph and wireless apparatus, excluding radio receiving sets.

  • 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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