Here is a compilation of essays on ‘Industrialisation in India’ for class 9, 10, 11 and 12. Find paragraphs, long and short essays on ‘Industrialisation in India’ especially written for school and college students.
- Essay on the Introduction to Industrialisation in India
- Essay on the Factors Hampering Rapid Industrial Development
- Essay on the Guiding Principles of Industrialisation
- Essay on the Shortcomings of Industrial Development
- Essay on the Contribution of Industrialisation
- Essay on Industrial Development since Independence
- Essay on the Pattern of Industrialisation: Structural Changes in Industry.
Essay # 1. Introduction to Industrialisation in India:
India for long has remained and continues to be predominantly an agricultural country, nearly 70 per cent of the country’s population derives their livelihood from agriculture.
In the case of agriculture, the operation of the law of diminishing returns starts operating at a relatively early stage compared with industries. In the case of India, nearly 70 per cent of the country’s labour force is engaged in the Agricultural Sector. Agricultural land in India just cannot absorb such vast number of workers in a productive and profitable way even with the present traditional techniques of production, not to speak of mechanised form of agriculture which in the United States employs just around 4 per cent of the labour force in the country.
It is said that the marginal productivity of labour in agriculture in India is zero, which means that there is much disguised unemployment in Indian agriculture. The workers outwardly appear to be employed, but in fact they add nothing to agricultural production; and even if a substantial amount of labour force is withdrawn from the agricultural sector, production of agricultural commodities will not decline.
I. Absorption of Displaced Workers:
Only the industrial sector can absorb workers displaced from agriculture; without large, medium, and small-scale modern industries, India will not be in a position to solve her problem of mass unemployment and mass poverty.
Even if agriculture is modernized and made more progressive, it must be realised that it would mean more displacement of labour by machines, and demand for agricultural commodities and especially for food grains is fairly inelastic. India cannot export increasing quantities of food grains and other agricultural commodities like tea, coffee, etc. to Western developed countries because of the low income elasticity of demand for agricultural commodities, especially food grains.
II. Indian Agriculture:
It must be realised that developed countries have not only modern industries, but they have also developed agriculture which is another reason why, if India remains a purely agricultural country and modernises her agriculture, she will not be in a position to sell her agricultural commodities in increasing quantities in the markets of developed and industrialised countries.
The demand for Indian agricultural commodities is declining in some cases, because developed industrial countries are going in for synthetic substances like man-made fibres for cotton yarn, synthetic rubber for natural rubber, plastic wrappings for jute bags and so on.
There is another reason why demand for Indian agricultural produce and other natural raw materials for developed countries will decline. Natural materials like iron ore and other metals are playing a decreasing role in finished industrial goods. Thus, instead of iron and steel, many motor and machine parts are at present being made of plastic and instead of natural metals various artificial substances are being increasingly used as substitutes.
III. Mass Unemployment:
Industrialisation is the only answer to India’s mass unemployment and poverty. In industries, the law of increasing returns operates over a longer range than in the agricultural sector.
This means that industries have a very large potentiality to provide productive employment opportunities to Indian people who today for want of any employment opportunities are thrown back on agriculture where their marginal productivity is zero. Thus, industries will provide employment to vast masses of people and provide income and help alleviate mass poverty and ensure a vast number of people rising standard of living.
IV. Increases in Demand:
Rapid industrialisation of India would mean increasing demand for food grains and other industrial raw materials produced by the agricultural sector (such as cotton, jute, tea, coffee, rubber, fruits, etc.) Thus, with industrialisation of the country, demand for agricultural commodities will rise, ensuring higher prices and thus ensuring more income to people engaged in the agricultural sector.
V. Abundance of Raw Material:
Another reason why there should be industrialisation in India is that India has vast industrial raw materials like cotton, jute, oilseeds, leather, tea, coffee, fruits, fish and so on. Instead of sending industrial raw materials abroad and importing finished goods from them paying substantial price for them, India herself can build a vast network of various industries for which abundant raw materials are available in the country.
VI. Wrong Impression:
Very often when the terms agriculture and industry are mentioned, there is the impression that the two sectors are somehow opposed to each other and that one sector can prosper only at the cost of the other sector. Nothing can be farther from the truth.
VII. Increase in Supply:
Increase in the supply of industrial goods like tractors, electrical and diesel engines and pump sets and other agricultural implements and chemical fertilisers will help modernise agriculture and increase per acre and per capita production in the agricultural sector.
People displaced from the agricultural sector, because of modernisation of Indian agriculture, can be provided employment opportunities in the industrial sector. That is how displaced persons from the agricultural sector were absorbed by the industrial sector in presently developed countries.
VIII. Defence System:
Industrialisation is also extremely desirable for another important reason. The entire modern defence system is based on the foundation of modern industries—automatic guns and rifles, canons, warships, bombers, missiles and various other defence equipments which can be produced in the country only if the country has a vast network of modern industries. Thus, defence and protection of the country from foreign aggression require that India possesses a strong industrial base which alone can supply thousands of defence items.
IX. Modernised Agriculture:
With developed and modernised agriculture and a vast network of large, medium and small scale modern industries. India will be less dependent on foreign countries for her vital needs. Dependence on foreign countries for an essential article like food grains or industrial commodity like crude oil or for defence equipment can produce disastrous political consequences for India, resulting in the loss of her independence.
For example, when food was being imported from the united States under P.L. 480 during the 1950s and 1960s, as otherwise there would have been a mass disaster, the United States tried to bring political pressure on India to make it yield to Pakistan on the Kashmir issue. Modernisation of agriculture and industrialisation will mean more self-reliance which is welcome both from economic and political points of view.
X. Change in Value-System:
Industrialisation also means a change in the value-system. Industrialisation will introduce new industrial culture—discipline, hard work, competitiveness, team work, self-reliance, adaptability, inventiveness and organisational ability.
It will be observed that India’s agricultural population is characterised by idleness, superstitiousness, extreme dependence on natural forces, fatalism, etc. These qualities will hardly make a country prosperous in modern times. Industrialisation is wanted in India because many features of industrial culture which will accompany the country’s industrialisation are essential-elements, if India is to live successfully in modern times and in a highly competitive world.
Essay # 2. Factors Hampering Rapid Industrial Development:
For rapid economic development and modernisation of Indian society, for providing increasing opportunities of employment, for making maximum use of indigenous resources, for raising the income of the people and their standard of living and thus solving the problem of mass unemployment and mass poverty prevalent in developing countries like India, rapid industrialisation is necessary, not only from the economic point of view but even from socio-political point of view.
While the objective of rapid industrialisation is extremely desirable in developing countries like India, there have been operating in these countries a number of factors that hamper the process of rapid industrialisation.
Classification of Factors:
These factors may be classified into four categories:
1. Economic Factors:
Rapid development of modern industries in a developing country like India badly needs development and provision of certain infrastructural facilities which may be absent or inadequate for quite some time, thus creating severe bottlenecks in the way of rapid industrialisation.
A basic necessity for rapid industrialisation is an efficient network of transport and communications system. The transport system brings raw materials from various centres to factories and carry produced goods to different markets in a short time. This makes large-scale production of goods and services possible.
It follows that absence of an adequate and efficient transport and communications system would put hurdles In the way of movement of raw materials and finished goods making large-scale production difficult as the produced goods cannot be quickly and efficiently moved to different markets in the country.
Developing countries including India suffer from inadequacy of transport and communications facilities (made up of roads and motor transport, railways, airways, inland and oceanic shipping, telephone and telegraph, and so on) hampering rapid industrial development. Transport has proved a bottleneck in the process of industrial development of the country.
a. Hurdle of Power:
Another hurdle is power or energy (as for example, supplied by coal, hydro and thermal and nuclear electricity, petroleum and so on). Without energy or power, the wheels of industry will not move. Most developing countries including India have been suffering from shortage of energy which is hampering their rapid industrial development. For example, in India while the supply of electricity has been increasing fairly rapidly since independence, demand for it far exceeds the supply.
b. Trouble with Transport:
The trouble with transport and electricity sectors is that vast investments are necessary for their development and governments in developing countries having limited financial resources are not in a position to invest substantial amounts in power generation. Secondly, the projects of transport and electricity sectors require long gestation period.
Another difficulty is that transport facilities and electricity generation cannot be increased when demand for it goes up. There is a minimum scale which must be adopted in both these sectors, whether there is or is not adequate demand for full capacity production in those sectors.
c. Infrastructural Facilities:
Then there are other infrastructural facilities like training institutions to prepare hundred types of skill needed for modern industries. Their absence or inadequacy poses a serious handicap. India for long had to employ foreign technicians who had to be paid high salaries (part in foreign currencies) and who may not be found suitable for work in a totally different socio-cultural background.
Another infrastructural facility is the network of financial and banking institutions and stock exchanges with enough financial resources to meet the investment needs of various industries that are to be set up.
Thus, transport, power, skills of various types, educational, financial, banking and professional institutions, which constitute or make for necessary industrial environment may be absent or may riot have been adequately developed in countries wanting to rapidly industrialise and that might hamper rapid industrial development.
Fortunately, India has developed since independence in 1947 a broad network of all these institutions that are helping industrial growth and development. But there is a feeling that except in metropolitan areas and big towns, in district and taluka places and in rural areas of the country, these institutions are not developed to the extent necessary, hampering rapid industrial development of the country.
2. Socio-Demographic Factors:
Rapid growth of population in a developing country may effectively hinder rapid industrialisation of the country. Rapid growth of population would mean that additional production of wealth would be used mainly for consumption by the additional number of people, thus adversely affecting the rate of saving and investment which are crucial to industrial and economic growth.
Additional population in a developing country would mean low per capita income, low rate of saving and therefore, low rate of investment and again as a consequence, low per capita income, and thus the vicious circle of poverty would continue with continually adverse effect on the rate of saving and investment which are two critical elements of industrial growth.
a. Division of Society:
For example, in the case of India, her society is characterised by caste, class, religion, etc. which have divided the community into water-tight compartments. Each caste has several sub-castes and each such caste and sub-castes have their own mode of eating, clothing, living and pattern of life.
This results in hampering mass production of goods for wide markets, because markets in India are fragmented on the basis of religion, caste and sub-caste. Also, caste and religions rivalries have divided Indian community into factions which find it difficult to unite for a common cause such as rapid industrial development.
This division, for example, would make trade unions weak with little bargaining power as these labour unions will come to be based on castes and religions. The same would be true in other professions and trades. This stratification of society, by making inter-caste and inter-religious communication difficult, makes implementation of any common programme of rapid industrialisation difficult. For long, only certain castes and communities were associated with industry and commerce.
b. Cultural Values:
Much more damaging to rapid industrialisation is the long-prevailing cultural values in India. Due to long foreign rule over the country, precarious monsoon and prevailing poverty which Indians have experienced for centuries, Indian mentality or outlook on life is generally characterised by fatalism, otherworldliness, attitude of resignation to one’s fate or destiny (due to the acceptance of the Theory of Karma) which holds the view that your life in the present world is determined by your sins or meritorious deeds in the past lives and no amount of efforts would change what you are fated to become during your present life-time.
And, therefore, Indian culture has for long come to be characterised by absence of a strong desire to improve one’s material conditions of life, considering material wealth as something sinful, and a simple life with only few essential wants meritorious and worth emulation. With this sort of value- system which shuns material prosperity, rapid industrialisation would be practically impossible.
And, therefore, rapid industrialisation of India would require radical changes in the attitude of the people and their value system with emphasis on material prosperity, personal profit motive, inventiveness, strong faith in modern sciences and technology, on cooperative efforts, hand work and discipline in individual and social life, and ability to take risks by experimenting with new products and processes all of which go to make what may be called modern industrial culture.
Industrialisation does not mean just establishing a few industrial establishments here and there; it means building up an extensive industrial structure based or sound foundations of industrial culture.
3. Public Administrative Machinery:
Developing countries like India suffer from scarcity of various resources, especially human resources necessary for bringing about rapid industrialisation and economic development. With a view to make the best use of available resources, these countries have rightly adopted economic planning as an instrument of rapid economic development, with emphasis on rapid industrialisation.
But economic planning and its effective implementation require a vast network of skilled and administrative personnel. But it so happens that an underdeveloped country like India also has an underdeveloped administrative structure.
a. Administrative Structure:
Thus, India has erected an enormously big administrative structure and has entrusted the administrative personnel with the gigantic task of administering hundreds of controls and issuing of licences, handling of vast funds and public enterprises. Lacking developmental culture, the administration has failed in properly implementing various schemes which together constitute Five Year Plans of India.
The administration in India is characterised by lack of development culture, lack of decision making ability and by bureaucratic delays, corruption, waste of various types of resources and inefficient implementation of developmental schemes.
Thus, India has an expanding public sector, there being in 1991,246 Central Government Public Sector Undertakings with a total investment of Rs.1,13,234 crores, apart from State-level public sector enterprises like the State Transport Corporations and State Electricity Boards.
b. Failure of Public Sector:
Thus, underdeveloped public administration has been hampering rapid industrialisation of the country. The public sector which has command over basic and vital infrastructural facilities has failed to keep up its pace of development with adverse effects on the development of industries, both in the public and private sectors.
4. International Environment:
Absence of favourable international environment would impede rapid industrial development in developing countries like India and it so happens that these forces are outside the control of most of the developing countries, including India.
Developed countries may put restrictions on exports of capital goods and equipment needed for rapid industrial development of developing countries like India, or raise their prices or they may prohibit export of latest technology or send inappropriate technology or impose hard conditions for selling patent rights or may send experts of inferior quality and who cannot give their best in totally different socio-cultural environment.
Developed countries may restrict flow of financial capital into developing countries, thereby creating foreign exchange problems for countries like India; or they may charge prohibitive rates of interest or put other harsh conditions hampering industrial and therefore, economic development of countries like India. Also, developed countries may follow policies, fiscal and trade, that hamper exports from developing countries or making the terms of trade adverse against them.
Essay # 3. Guiding Principles of Industrialisation:
When India won freedom, its industrial scenario was indeed grim. Of course, there were a few consumer goods industries and one or two steel mills, basic industries were largely neglected and capital goods production was insignificant. Further, most of the industries were largely concentrated in a few regions while most parts of the country were without any industry worth the name. Plans for industrialisation had therefore to rectify these imbalances by bringing about integrated and balanced development of industries in various regions of the country.
The guiding principles or main objectives of the programmes of industrial development had therefore been:
(a) To bring about a faster pace of industrialisation for achieving a rapid growth of the economy.
(b) To develop basic, heavy and capital goods industries to fill the gaps in our industrial structure.
(c) To provide basic infrastructure for rapid growth of industry.
(d) To create employment opportunities.
(e) To promote balanced regional development.
(f) To help in promoting import substitution with a view to limiting imports and saving foreign exchange.
Having set the above guiding principles, the Government of India took upon itself the task of providing basic infrastructure for rapid industrial development. Rail transport, electricity, heavy electrical, chemicals, machine tools, iron and steel, etc. were sought to be directly developed by the state under the Public Sector. Private sector was provided necessary incentives and concessions in the government’s policy and given financial accommodation by the public financial institutions. In brief, there was an all-around effort, both public and private, to put India on the industrial map of the world.
The industrial progress that the country has made over the past four decades is commendable. India is now counted among the top ten industrial nations of the world. Contribution of manufacturing sector to the GDP has gone up from a bare ten per cent in 1950-51 to nearly twenty per cent now.
The industrial sector as a whole (comprising manufacturing, electricity, gas and water supply and mining and quarrying) accounts for nearly 27 per cent of GDP as against barely 15 per cent in 1950-51.
Essay # 4. Shortcomings of Industrial Development:
However, it must be accepted that industrial development in India has not been strictly in accordance with the guiding principles and it has failed to achieve some of the cherished objectives.
An important shortcoming of industrial growth has been its unequal distribution between various regions. The areas which already had important industries, have provided nucleus for further concentration of industry. Not only traditional industrial cities have become overcrowded causing environmental degradation, but also traditional industrial states have attracted more industries thereby causing regional imbalances.
For example, nine States viz., Andhra Pradesh, Bihar, Gujarat, Karnataka, Madhya Pradesh, Maharashtra, Tamil Nadu, Uttar Pradesh and West Bengal, account for about 80 per cent of industrial activity in India. Industries contribute about three-fourths of value added and eighty per cent of employment in these States.
All other States outside this group of nine have thus very little industrial output and employment. This shows that the objective of regional balanced growth through industrialisation has remained unfulfilled and that industrial development of the past four decades has further accentuated regional imbalances.
Another weakness of industrial development in India has been in the field of employment generation. Industrial expansion was sought to be the means of eradicating unemployment. However, the manufacturing sector or the large industries have failed to generate employment significant enough to make any dent into the unemployment problem.
In India, labour force has been growing at a rate of about 2.5 per cent per annum but industrial employment growth rate has been only around 1 per cent thus causing pressure on non-industrial activities such as agriculture, trade and service sectors.
An important consequence of industrial development in India has been the rapid growth in industries producing consumer durables. The growth rate of industries producing such goods consumer electronics has been faster than those producing goods for mass consumption. This shows that industry is catering more and more to the requirements of the rich rather than those who really need to benefit from industrial growth.
Yet another snag with industrial development of India has been the unwieldy and inefficient growth of the public sector. Though initially conceived as the vehicle of industrial growth and an instrument to prevent concentration of economic power in the private hands, the gigantic growth of the public sector and its inefficient functioning has been a drain on Indian economy.
These enterprises have not much to show by way of efficient performance; a large majority of them have been making perpetual losses thus causing a continued drain on tax-payers’ money. Reforms are now under way to improve functioning of public enterprises by incorporating some element of privatisation through public sector disinvestment in their equity that is being offered to the private sector.
The overall picture of India’s industrial development is thus a mixed one. Over the years industry has grown at a reasonably high rate but there have been wide variations in annual growth rates from one decade to another.
There has been expansion of the basic industries and the capital goods sector, but also the production of consumer durables has been faster than the goods of mass consumption. The industrial expansion has also failed to eradicate unemployment or mitigate regional inequalities.
Essay # 5. Contribution of Industrialisation:
Industrialisation has come to be regarded as synonymous with economic development. Fast economic development everywhere has been possible essentially due to rapid industrialisation.
The following is the contribution of industrialisation to the Indian economy:
(i) Share in National Income:
The share of the secondary sector is the net domestic product of India, which was as low as 16.7 per cent in 1950-51, has now risen to 29.25 per cent. This is in spite of the fact that a large portion of the industrial capacity remains unutilised for various reasons.
(ii) Contribution to Employment:
Industries offer large employment opportunities to the people. Employment in industrial sector grew very moderately by 1.55 lakhs during the First Plan period. In March, 1995, however, the number of workers employed in the industrial sector went up to 80.6 lakhs in the private sector and 194.66 lakhs in the public sector.
(iii) Growth of Industrial Output:
Industrialisation has helped the country in producing not only the essential consumer goods but also the capital goods. A wide variety of goods are produced in India making the country least dependent upon the industrialised nations. The growth rate of industrial output which was only 5.7 per cent during the First Plan period has gone up to 8.7 per cent in 1981-82.
The growth rate declined to 3.9 per cent in 1982-83 but reached 8.2 per cent in 1983-84. The growth rate of industrial production, however, declined in 1984-85 to 6.68 per cent, and further to 6.4 per cent in 1985-86. Lower growth rate of infrastructural industries, viz., electricity, coal, crude petroleum, saleable steel, etc. was responsible for this setback.
However, during the past four years the rate of industrial growth has again picked up. In 1985-86, the rate of industrial growth was 8.7 per cent and in 1986- 87, it went up to 9.1 per cent. In 1987-88 the rate of overall industrial growth was 7.3 per cent and estimated at 8.7 per cent in 1988-89. In 1989-90, it came down to 8.6 per cent and further declined to 8.3 per cent in 1990-91.
General Index of Industrial Production showed a decline of 0.6 per cent in 1991-92. In 1992-93 also the industrial sector was slow to recover at 2.3 per cent. But, thereafter, the performance of the industrial sector has been very impressive. In 1993-94, the growth rate of industrial output was 6.0 per cent. It went up to 9.4 per cent in 1994-95, 11.6% in 1995-96 but expected to fall at 6.7 per cent in 1996-97.
Essay # 6. Industrial Development Since Independence:
Industrialisation has an important role to play in the economic development of the underdeveloped economies. The tremendous gap in the per capita incomes of the developed and the underdeveloped countries is largely a reflection of the disparity in the structure of those economics.
The former are largely industrial economies while the latter are predominantly dependent upon agriculture. That a bold programme of industrialisation was the crying need of our economy, was realised by the government while chalking out the programme of economic development.
The process of industrialisation in the country started with the Second Five Year Plan in 1956. And within a period of four and a half decades growth and diversification of industries in India has been indeed remarkable. India may be said to have initiated the process of industrial revolution, which is bound to transform the Indian economy into a prosperous industrialised country in the coming years.
It would be no exaggeration to say that country has achieved in a short span of less than fifty years, such a rapid progress in industrialisation and diversification of industrial structure which is truly revolutionary when compared to the preceding century of slow, uneven and haphazard growth.
Table 1 shows the production levels attained in some selected industries over the period of development during last four decades. The production figures given in the table show a manifold increase in production in basic and key industries. More significant is the progress made in the field of steel, aluminium, chemicals and chemical fertilisers, petroleum products, engineering goods industries.
There has, however been successively reduced levels of production of the mill made cotton textiles. But expansion in production of cloth in the decentralised sector has largely compensated for the shortfalls in the mill sector production. The country is now, more or less, self- sufficient in the production of consumer goods and some basic items like iron and steel.
Essay # 7. Pattern of Industrialisation: Structural Changes in Industry:
One of the major shortcomings of industrial structure at the time of independence was that whereas India did possess some of the reasonably well developed consumer goods industries like cotton textiles, sugar, etc., capital goods industries like steel, heavy electricals, heavy engineering goods and machine making industries were practically absent.
Thus, under the Plans special efforts were made to rectify this imbalance. Several steel plants, heavy electricals, machine tools and many other basic and key industries were set up. The gaps in industrial structure were, thus, sought to be filled up through massive expansion in capital goods industries.
Indian industry has undergone some significant structural changes since the era of modern industrialisation was ushered in during the Second Five Year Plan (1956-61).
i. Rapid Growth of Basic and Capital Goods Industries:
One of the major handicaps of the Indian economy during the pre-independence days was the virtual lack of basic industries (steel, cement, etc.) and capital goods industries (industries producing machinery, equipment, etc.) Basic industries lay down the foundations on which the industrial superstructure stands while capital goods industries enlarge capacity for future production.
The planning strategy incorporated in the Mahalanobis model of development which we adopted in the early years of planning and are still continuing with that in some modified form, lays all out emphasis on the capital goods sector and basic and heavy industries. Industrial and economic development based largely on this model has thus led to rapid growth of basic and capital goods industries.
Though there have been fluctuations in the growth rate of these industries from one year to another, the trend rate of growth of the capital goods industries has been much higher than the average growth rate of the industrial section as a whole. This has immensely contributed to the expansion in our industrial capacity and laid down firm foundation of industrial development in the country.
ii. Slow Growth of Consumer Goods Industries:
A major weakness of the pattern of industrial development has, however, been a relatively slow growth of goods of mass consumption such as cotton textiles, sugar, vegetable oils, etc. An important factor responsible for this is that most of these consumer non-durable goods are agro-based products and consequently sluggish growth in agricultural output of cotton, sugarcane oilseeds, etc. is largely responsible for slow growth of these industries. Lower production and inadequate availability of these goods of mass consumption has led to rise in their prices and contributed to inflation in the country.
iii. Increased Production of Consumer Durables:
An important outcome of the process of industrial development in India has been the rapid increase in the production of consumer durable goods such as automobiles, refrigerators, televisions, electrical and electronic goods. The production of such goods has recorded a four-fold increase between 1980-81 and 1994-95.
There was further increase of around 65 per cent between 1994-95 and 1997-98. During the same period, there has been a very slow growth of nondurable goods, such as cloth and other items of daily use. This shows that resources are being rapidly diverted from the production of items of mass consumption (those used by common people) to the goods preferred by the rich and the upper middle class people.
The socio-economic consequences of this pattern of production are the economy is gradually becoming pro-rich i.e., catering to the needs of the affluent persons and neglecting the basic requirements of the poor. Thus, while there may be a whole range of luxury goods available in the market, the poor persons still remain unclad and under-nourished.
This is surely not a desirable pattern of production for a country like India where even now over a third of the people live below the poverty line. Such production pattern is only indicative of the further growth of inequalities which the Plans sought to reduce. Unless this pattern of production is modified in favour of the poor and lower middle class persons, social tensions and political instability are bound to grow further, thereby threatening the very fabric of our socio-economic structure.
iv. Increasing Role of the Public Sector:
One of the important developments in the field of industry during the Five Year Plans has been the rapid expansion of Public Sector in Indian Industries. While at the beginning of the Planning era in 1950-51 there were only 5 public sector undertakings under the Central Government with an investment of about Rs.29 crores, by the end of March 1994 their number increased to 236 and their investment stood at Rs.2,02,000 crores. The public sector industries now occupy a very important place in the industrial economy of India. Their production and sales turnover has multiplied manifold during the Plans.
v. Expansion in Infrastructure:
Under the Plans, infrastructural facilities like power, transport, communications, etc. have shown a remarkable expansion and modernisation. There has been an all-around increase in the production of energy; production of coal and lignite has increased over ten folds between 1950-51 and 1997-98. Installed capacity in power section has gone up about fifty times, power generation has increased about seventy five times and production of petroleum refinery products increased around 260 times over the period 1950-51 to 1997-98.
vi. Growth of Small Scale Industries:
A significant feature of industrial development during the Five Year Plans has been the special emphasis on small industrial sector. Consequently, the small industries have now come to occupy a pride of place in India’s industrial structure.
The number of small scale industrial units has increased from around 16 thousand in 1950-51 to 30.14 lakh in 1997-98. These industries now account for 40 per cent of the value added by the entire manufacturing sector, about 7 per cent of GDP and around 35 per cent of country’s exports and employ a major part of working force in industrial sector.
To conclude, Indian industries have made a tremendous progress during the Five Year Plans. There has been a rapid expansion in industrial output, a substantial development in the basic and key industries and an impressive growth of mineral and energy resources. It is in view of the rapid developments in industry that India has now come to occupy a place among the major industrial economies of the world.
Overall assessment of industrial development shows that over the years Indian industry has been considerably modernised. Most of our products which suffered in the world market because of their high cost and low quality are now developing a competitive edge and would soon be able to withstand foreign competition offered by these products from advanced industrial nations.
We have also acquired a certain degree of self-reliance in the case of many industrial goods such as iron and steel, machinery, fertilizers, etc. Our industrial base has become quite sound. Investment climate has tremendously improved as both domestic as well as foreign investment is continuously increasing in various industrial sectors.
However, our industry has failed to generate substantial employment and even today employs a very small fraction of our total labour face. High cost and inefficiency still pervade many industries and the incidence of industrial sickens is very high. To attain and maintain high industrial growth rates we have not only to improve our efficiency and competitive edge, but also develop new products, explore new markets and continue modernisation programmes with the choice of appropriate technology that does not sacrifice employment at the altar of rapid output growth.