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India has a long history of industrial policies dating back to its independence. So much so that Lawrence A. Veit considered saying, “If India had as much industry as it does industrial policy, that this would be a significantly better-off country.” With this backdrop in mind, the following is a review of India’s Industrial Policies for the development and promotion of small-scale businesses.
1. The 1948 Industrial Policy Resolution (IPR) entails the following:
In 1948, the Industrial Policy Report (IPR) recognised the importance of small-scale industries in the country’s overall industrial development for the first time. A long time has passed since it was realised that small-scale industries are particularly well adapted to utilising local resources and creating employment opportunities.
They have, on the other hand, been dealing with severe raw material, capital, skilled labour, marketing, and other challenges for a long time, and they will continue to do so. As a result, the Industrial Policy Report (IPR) of 1948 emphasised that the Central Government should address the issues faced by small-scale businesses with the assistance of state governments. Overall, the essential goal of IPR 1948, as it applied to small-scale firms, was ‘protection’ in its most basic form.
2. The 1956 Industrial Policy Resolution (IPR) outlined the following:
The Industrial Policy of 1948 made a significant contribution to the country’s industrial development by determining the type and pattern of industrial growth in the country. The period immediately following the IPR of 1948 was characterised by significant changes in the country. Planning, for example, had been organised, and the First Five Year Plan 1951-56 had been completed at this point. Was also passed in 1951, the Industries (Development and Regulation) Act, which sought to regulate and govern the country’s manufacturing industries.
Additionally, the parliament had designated “the socialist pattern of society” as the primary goal of social and economic policy throughout this period as well. In light of this, it appeared that the passage of a new industrial policy resolution was required. The upshot of this was the International Protection Regulations 1956 (IPR 1956).
3. The 1977 Industrial Policy Resolution (IPR) outlined the following:
On one hand, there was uneven industrial expansion biassed in favour of the large and medium-sized enterprises, and on the other, there was growing unemployment in the two decades after the Industrial Policy Reform (IPR) of 1956. As a result of this situation, there has been a renewed emphasis placed on industrial strategy and development. As a result, the Institute of Public Relations (IPR) was established in 1977.
4. The Industrial Policy Resolution (IPR) of 1980, states that
On July 23, 1980, the Indian government passed a new Industrial Policy Resolution, which became effective immediately (IPR). The Industrial Production Regulations of 1980, the main purpose was to make it easier to improve industrial production by maximising the use of current capacity while also expanding industries.
The following adjustments were recommended in the small business sector, according to the resolution:
(i) Increases in investment ceilings for small- and medium-scale units from Rs. 1 lakh to Rs. 2 lakhs, and for ancillaries from Rs. 15 lakhs to Rs. 25 lakhs have been announced. Small- and medium-scale units have had their ceilings raised from Rs. 10 lakhs to Rs. 20 lakhs.
(ii) The concept of nucleus plants will be established in each industrially backward district, replacing the existing model of District Industry Centres in order to enhance maximum production.
(iii) The development of village and rural sectors in order to establish economic viability in environmentally friendly communities is being pursued.
As a result, the IPR 1980 reemphasized the essence of the IPR of 1956, which was previously understated. Small-scale company has been the most productive sector in terms of producing wage and self-employment opportunities in the country.
5. The Industrial Policy Resolution (IPR) of 1990, states that
The International Public Relations Conference 1990 (IPR 1990) was announced in June 1990. Small-scale firms continue to be emphasised in the resolution as being critical in attaining the aim of employment creation, particularly in the context of the small-scale industry.
The plant and machinery investment ceiling for small-scale firms (which was originally fixed at Rs. 35 lakhs) has been raised from Rs. 35 lakhs to Rs. 60 lakhs and the maximum investment ceiling for auxiliary units has been raised from Rs. 45 lakhs to Rs. 75 lakhs.
According to the 1981 Census, the investment ceiling for tiny units has been raised from Rs. 2 lakhs to Rs. 5 lakhs if the unit is located in a region with a population of 50,000 people or more, whichever is higher.
CONCLUSION:
The Indian government places a greater emphasis on the economic and industrial development of India’s backward, mountainous, and tribal areas. Committees have been formed to certify and promote the growth of small-scale industries and business units, as well as to propose necessary programs.
The government has established special economic zones with reduced power, water, and land tariffs, among other things, to make it easier for enterprises to operate in certain locations. The government has also offered financial help to small businesses by establishing financial aid institutions such as NABARD.
