. Development of Industry India was committed to the idea of promoting rapid industrial growth for economic development. Development can be achieved through several pathways. In a country like India with a large population where many raw materials were grown or were available, processing industries which were more labour- intensive would have also led to industrial growth.
Alternatively, the Gandhian model stressed a model of growth with village and cottage industries as the ideal way to produce consumer goods, which would eliminate rural poverty and unemployment. But the government adopted the Nehruvian model of focusing on large scale, heavy industry to promote wide-ranging industrial development. In keeping with the basic principle of a “socialistic society”, the state would play a major role in developing the industrial sector through setting up units wholly owned by the state. The emphasis on heavy industry was to promote the production of steel and intermediate products like machines, chemicals and fertilizers for the developing industries.
The social purpose that would be achieved by this model of development was to restrict private capital which was considered to be exploitative and excessively profit-oriented, which benefited a small class of capitalists. (a) Industrial Policy A series of Industrial Policy statements were adopted to promote these objectives. The first policy statement was made in . It classified industries into four categories: .
Strategic industries which would be state monopolies (atomic energy, railways, arms and ammunition); . industries of national importance under government control (heavy machinery, fertilizer, heavy chemicals, defence equipment, etc.); . Industries in both the public and private sectors; . Industries in the private sector.
Envisioning a New Socio-Economic Order Hyderabad and Haridwar. Steel plants were set up in the relatively backward belt of Orissa, Bihar and West Bengal. Public sector enterprises also contributed to the national exchequer because their profits accrued in part to the central government. Thus the growth of the public sector served many economic and social purposes, in addition to creating industrial capacity in the country.
BHEL, Tiruchirappalli (c) Crisis